Fiscal Policy Focuses on Manipulating _____

question 36

Multiple Choice

Fiscal policy focuses on manipulating _____.

• A)aggregate demand to smooth out business fluctuations
• B)aggregate supply to smooth out business fluctuations
• C)both aggregate supply and aggregate demand to smooth out business fluctuations
• D)aggregate demand to stimulate the economy and aggregate supply to contract it
• E)short-run aggregate supply to stimulate the economy and aggregate demand to contract it

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Definitions:

Working Capital Accounts

Accounts that reflect a company's current assets minus its current liabilities, providing a snapshot of its short-term financial health and operational efficiency.

Borrowing Rate

The interest rate that a lender charges a borrower for the loan of funds, varying based on credit risk, loan amount, and duration.

Net 60

A payment term indicating that payment is due 60 days after the invoice date.

Lock Box System

A banking service provided to companies for speeding up collection of payments by having those payments sent directly to a bank's PO box, rather than to the company.