Which Argument Was Made in Favour of Using Discretionary Fiscal

question 247

Multiple Choice

Which argument was made in favour of using discretionary fiscal policy in fighting the Great Recession?

• A) Monetary policy could not be effective,since interest rates were near zero.
• B) If taxes were increased,the budget could be balanced.
• C) If government spending decreased,the budget surplus would increase.
• D) The lags associated with monetary policy would be destabilizing.

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Definitions:

Retirement Savings

Money that has been put aside or invested with the goal of providing financial security upon retirement.

Conservative

A risk-averse approach, especially in investment or financial strategies, focusing on preserving capital and maintaining a low risk profile.

Withdraw

The action of removing funds from an account or investment.

Compound Rate

The rate at which interest is calculated on the initial principal and also on the accumulated interest of previous periods.