Functional finance is:
A)based on empirical evidence that fiscal policy can be effective in smoothing business cycles.
B)based on the political realities of voters wanting their government to respond to recessions.
C)a theoretical proposition, not a moral proposition.
D)a proposition supported by public choice economists.

Question

Quizplus · Accepted Answer

Functional finance is a theoretical proposition that suggests government fiscal policy should be used to achieve full employment and price stability, without moral considerations about budget deficits or surpluses.

Functional Finance Is