New Tapan, an African country, invested resources in the defense sector, and as a result, its budget deficit grew. To decrease the budget deficit, the government cut down its expenditures in several other sectors and imposed higher taxes. In this scenario, the measures implemented by the government of New Tapan most likely created _____.

Question

Quizplus · Accepted Answer

The fiscal cliff refers to a situation where a government implements spending cuts and tax increases to reduce its budget deficit, similar to the measures taken by New Tapan.

New Tapan, an African Country, Invested Resources in the Defense