Which statement is NOT an argument against the use of expansionary fiscal policy?
A) Government spending may crowd out private spending.
B) Government borrowing may crowd out private investment spending.
C) Government borrowing may reduce the marginal propensity to consume.
D) Government budget deficits may lead to reduced private spending.

Question

Quizplus · Accepted Answer

This statement is actually an argument against government borrowing, which is a tool used in expansionary fiscal policy. The other statements all present potential negative consequences of using expansionary fiscal policy, such as crowding out private spending and investment or leading to reduced private spending due to budget deficits.

Which Statement Is NOT an Argument Against the Use of Expansionary