During a recession, the quickest way for the government to increase economic output would be to
A. increase government purchases and reduce taxes.
B. reduce government purchases and increase taxes.
C. reduce government purchases and reduce taxes.
D. increase government purchases and increase taxes.
Answer: A
You might also like to view...
Which of the following statements is true of the number of entrepreneurs in an economy?
A) The number of entrepreneurs is likely to be higher in an economy with inclusive institutions than in an economy with extractive institutions. B) The number of entrepreneurs is likely to be higher in a command economy than in a market economy. C) The number of entrepreneurs is likely to be the same in an economy with inclusive institutions and an economy with extractive institutions. D) The number of entrepreneurs is likely to be the same in a command economy and a market economy.
During which time will fiscal policy be the most effective?
A) normal times B) times of war C) in the middle of expansions D) times of stagflation