You are a member of Congress when the economy is in a recession.If your goal is to achieve a fully employed labor force, which of the following fiscal policy scenarios should you follow?
A) Eliminate a federal budget deficit or add to a federal budget surplus.
B) Raise government purchases, reduce taxes, and/or increase transfer payments.
C) Decrease government purchases, increase taxes, and/or cut transfer payments.
D) Raise government purchases, raise taxes by more than the increase in government purchases, and decrease transfer payments.
Correct Answer:
Verified
Q21: Budget surpluses exist when:
A)government spending exceeds its
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Q36: If unemployment is the most significant problem
Q37: An increase in transfer payments combined with
Q39: An increase in government purchases combined with
Q41: If the marginal propensity to consume is
Q42: A decrease in transfer payments will have
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