Which government sector has the ability to respond countercyclically to the economy?
A)State only.
B)Federal only.
C)Local only.
D)Federal,state,and local.

Question

Quizplus · Accepted Answer

The federal government has the ability to respond countercyclically to the economy through measures such as adjusting taxes, spending, and monetary policy, unlike state and local governments which often have balanced budget requirements that limit their ability to engage in such activities.

Which Government Sector Has the Ability to Respond Countercyclically to the Economy