Which of the Following Will Definitely Result in Fiscal Stimulus

question 22

Multiple Choice

Which of the following will definitely result in fiscal stimulus?

• A) Greater government spending and lower taxes
• B) Greater government spending and higher taxes
• C) Lower government spending and lower taxes
• D) Lower government spending and higher taxes

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Definitions:

Short-Run Effects

Immediate or temporary outcomes of a policy or economic change that manifest before long-term adjustments can take place.

Quantity Of Money

The total amount of money (cash, coins, and bank deposits) in circulation within an economy.

Tradeoffs

Refers to the concept in economics that by choosing one option, another option is foregone.

Basic Principle

A fundamental rule or concept that forms the foundation of a system, theory, or idea.