Contractionary fiscal policy occurs when the
A) government decreases spending or increases taxes to slow economic expansion.
B) government decreases spending or decreases taxes to slow economic expansion.
C) government increases spending or increases taxes to slow economic expansion.
D) government increases spending or decreases taxes to stimulate the economy toward expansion.
E) Federal Reserve decreases money supply to stimulate the economy toward expansion.
Correct Answer:
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Q16: Fiscal policy includes
A) only increases and decreases
Q17: Monetary policy is
A) the use of the
Q18: When aggregate demand is low enough to
Q19: As part of the Economic Stimulus Act
Q20: The second of two significant fiscal policy
Q22: Expansionary fiscal policy leads to
A) decreases in
Q23: If the unemployment rate falls below the
Q24: Assume that the government is currently balancing
Q25: A government might want to reduce aggregate
Q26: Congress and the president would conduct contractionary
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