How does the government typically change fiscal policy to try to improve the U.S. economy during a recession?A.By increasing taxes on businesses and individualsB.By increasing the amount of money in circulationC.By decreasing the amount of money in circulationD.By lowering taxes on businesses and individualsSUBMITarrow_backPREVIOUS
Question
How does the government typically change fiscal policy to try to improve the U.S. economy during a recession?A.By increasing taxes on businesses and individualsB.By increasing the amount of money in circulationC.By decreasing the amount of money in circulationD.By lowering taxes on businesses and individualsSUBMITarrow_backPREVIOUS
Solution
During a recession, the U.S. government typically tries to improve the economy by lowering taxes on businesses and individuals (Option D). This is done to stimulate spending and investment, which can help to boost economic activity. The government may also increase government spending, which can create jobs and further stimulate the economy. This is part of what's known as fiscal policy, which involves the use of government revenue collection (taxation) and expenditure (spending) to influence the economy.
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How does the government typically change fiscal policy to try to keep the economy stable during a period of rapid economic growth?A.Lowering taxes on businesses and individualsB.Increasing the amount of money in circulationC.Decreasing the amount of money in circulationD.Increasing taxes on businesses and individualsSUBMITarrow_backPREVIOUS
During a recession, expansionary fiscal policy may involve: A. Cutting social welfare programs B. Raising interest rates to control inflation C. Implementing trade barriers to protect domestic industries D. Increasing government spending and reducing taxes
To ameliorate the effects of a recession, a government could enact appropriate policies including: a. increasing government purchases. b. decreasing defence spending. c. increasing tax rates d. increasing taxes by a fixed amount.
To solve a recessionary gap, by using Fiscal Policy, the Federal government would decrease taxes and decrease government expenditure. Group of answer choicesTrueFalse
fiscal policy is used in response to recession.
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