Using Demand-Side Fiscal Policy to Stimulate Aggregate Demand When the Economy

question 68

Multiple Choice

Using demand-side fiscal policy to stimulate aggregate demand when the economy is at full employment will primarily result in

• A) unemployment.
• B) underemployment.
• C) inflation.
• D) a large economic expansion.

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Definitions:

Dividend Yield

A financial ratio that indicates how much a company pays out in dividends each year relative to its stock price.

Volatility

Refers to the degree of variation of a trading price series over time, indicating the level of uncertainty or risk associated with a security's value.

Hedge Ratio

A ratio used to adjust or hedge the risk exposure of an investment by comparing the value of the position protected to the value of the protective instrument.

Hedge Ratio

A ratio used to determine the portion of an asset or portfolio that is protected or hedged against market movements.