It will be difficult to institute fiscal policy in a stabilizing manner because politicians will find
A) it more attractive to raise taxes than to increase spending.
B) it attractive to increase taxes during a recession, but they will be reluctant to reduce them during an expansion.
C) budget deficits attractive during a recession, but they will be reluctant to run budget surpluses during an expansion.
D) budget surpluses attractive during a recession, but they will be reluctant to run budget deficits during an expansion.

Question

Quizplus · Accepted Answer

This is because politicians are more likely to increase spending in order to please their constituents and win reelection. Budget deficits can be used to finance these spending increases, but during an expansion when the economy is growing, politicians may be reluctant to run budget surpluses because it may lead to unpopular spending cuts or tax increases. Additionally, during a recession, it is easier to justify a budget deficit to stimulate the economy.

It Will Be Difficult to Institute Fiscal Policy in a Stabilizing