The fiscal policy response to the recession of 2008-2009 was
A) a substantial increase in the budget deficit just as Keynesian analysis would recommend.
B) a balanced budget, just as Keynesian analysis would recommend.
C) a substantial increase in the budget deficit, which was highly inconsistent with Keynesian analysis.
D) a shift of the federal budget toward a large surplus, which reflected the views of the critics of Keynesian economics.

Question

The fiscal policy response to the recession of 2008-2009 was
A) a substantial increase in the budget deficit just as Keynesian analysis would recommend.
B) a balanced budget, just as Keynesian analysis would recommend.
C) a substantial increase in the budget deficit, which was highly inconsistent with Keynesian analysis.
D) a shift of the federal budget toward a large surplus, which  reflected the views of the critics of Keynesian economics.

Quizplus · Accepted Answer

The fiscal policy response to the 2008-2009 recession involved a substantial increase in the budget deficit, consistent with Keynesian economics, which advocates for increased government spending to stimulate demand during economic downturns.

The Fiscal Policy Response to the Recession of 2008-2009 Was