Which of the following provides fiscal stimulus to the economy?
A) Higher interest rates
B) Increased imports
C) More efficient employment of resources
D) Increased government purchases

Question

Quizplus · Accepted Answer

Increased government purchases directly inject money into the economy, which serves as fiscal stimulus. Higher interest rates have the opposite effect by decreasing spending and investments. Increased imports and more efficient employment of resources do not necessarily serve as direct fiscal stimulus.

Which of the Following Provides Fiscal Stimulus to the Economy