The In the News article in the text titled "Fiscal Policy in the Great Depression" discusses fiscal spending and taxation.During the Great Depression,the federal government pursued a policy of fiscal restraint that led to
A)An increase in the structural deficit.
B)A decrease in the structural deficit.
C)An increase in aggregate demand.
D)An increase in taxes.

Question

Quizplus · Accepted Answer

During the Great Depression, the federal government pursued a policy of fiscal restraint, which means they decreased their spending and increased taxes to balance the budget. This led to a decrease in the structural deficit, which is the portion of the budget deficit that remains even when the economy is at full employment. However, this policy also contributed to the prolonged economic downturn by reducing aggregate demand, as consumers and businesses had less money to spend.

The in the News Article in the Text Titled "Fiscal