Which of the Following Would Be Most Likely to Induce

question 27

Multiple Choice

Which of the following would be most likely to induce Congress and the president to conduct contractionary fiscal policy? A significant

• A)decrease in oil prices.
• B)decrease in real GDP.
• C)increase in inflation.
• D)increase in labor productivity.

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Definitions:

Lump Sum Payment

A single payment made at a particular time, as opposed to multiple payments made over a period.

Present Value

The present fiscal value of a future sum of money or sequence of cash inflows, determined by a specified rate of return.

Perpetuity

A financial instrument or investment that generates a constant stream of cash flows with no end date.

Annuity Stream

A sequence of payments made at equal intervals, such as monthly or annually.