In 20091, President Obama and Congress stimulated aggregate demand by
A) increasing taxes and government spending.
B) decreasing taxes and government spending.
C) increasing taxes and decreasing government spending.
D) decreasing taxes and increasing government spending.

Question

Quizplus · Accepted Answer

The best choice is D because President Obama and Congress decreased taxes and increased government spending, which stimulates aggregate demand by putting more money into the hands of consumers and businesses. This approach is known as expansionary fiscal policy.

In 20091, President Obama and Congress Stimulated Aggregate Demand by