The budget deficit increased during the Great Recession of 2007-2009 and the financial crisis of 2008 because of _____
A) an increase in tax rates for high-income households.
B) a sudden increase in terrorist attacks and anthrax scares.
C) low interest rates that crowded out private investment.
D) discretionary tax cuts and greater outlays on unemployment benefits.
E) greater outlays on national defense spending.

Question

Quizplus · Accepted Answer

During the Great Recession and financial crisis, in order to stimulate the economy and help those who were unemployed, the government implemented discretionary tax cuts and increased spending on unemployment benefits, which increased the budget deficit.

The Budget Deficit Increased During the Great Recession of 2007-2009