Which of the Following Fiscal Policy Changes Would Be the Most

question 119

Multiple Choice

Which of the following fiscal policy changes would be the most expansionary?

• A) A $40 billion increase in government spending
• B) A $20 billion tax cut and $20 billion increase in government spending
• C) A $10 billion tax cut and $30 billion increase in government spending
• D) A $40 billion tax cut

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Definitions:

Human Resources

The department within an organization that is responsible for managing employee-related processes including hiring, training, compliance, and benefits.

Developed Nations

Countries with advanced industrial infrastructure, high living standards, and sophisticated economies.

Capital Formation

The creation of capital goods, which are used to produce other goods and services. It is a measure of economic growth and development.

Trade Deficit

The situation when a country imports more than it exports.