An Example of Contractionary Fiscal Policy Is

question 37

Multiple Choice

An example of contractionary fiscal policy is

• A) an increase in government expenditures,or an increase in taxes,or both.
• B) a decrease in government expenditures,or a decrease in taxes,or both.
• C) an increase in government expenditures,or a decrease in taxes,or both.
• D) a decrease in government expenditures,or an increase in taxes,or both.
• E) increasing government expenditures while holding taxes constant.

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Definitions:

Expense Accruals

The recording of expenses that have been incurred but not yet paid, ensuring that expenses are matched with the revenues they helped generate in the same period.

Projected Benefit Obligation

A financial measurement that estimates the total amount of benefits an employer is expected to pay out to participants in a defined benefit plan.

Present Value

A financial concept that calculates the current worth of a future sum of money or stream of cash flows given a specified rate of return.

Future Salary Levels

Projected or anticipated salaries for employees, taking into account factors such as inflation, promotion prospects, and market trends.