If the economic problem is low productivity and high unemployment,the fiscal policy action on the demand side would be to

Question

Quizplus · Accepted Answer

To combat low productivity and high unemployment, the government should increase spending through fiscal policy. This will increase aggregate demand, stimulating the economy and creating jobs. Cutting taxes may not be as effective as individuals and businesses may choose to save the extra income instead of spending it, and reducing government spending may worsen the problem by decreasing demand even further.

If the Economic Problem Is Low Productivity and High Unemployment,the