In bringing an economy out of a recession, a government will often resort to ________ fiscal policies, which often results in budget deficits.

Question

Quizplus · Accepted Answer

In order to bring an economy out of a recession, the government will resort to expansionary fiscal policies. This involves increasing government spending and/or decreasing taxes in order to stimulate economic growth. However, this often results in budget deficits as the government is spending more money than it is bringing in through taxes.

In Bringing an Economy Out of a Recession, a Government