Which of the following is not a reason why the stimulus package that the government implemented during the Great Recession of 2007-09 did not have as strong an impact on GDP and
Unemployment as expected?
A) Households had very high debt levels.
B) Consumers raised their saving rates.
C) The stimulus package caused prices to fall in many sectors.
D) The effects of the stimulus package were diffuse and spread thinly among many sectors.

Question

Quizplus · Accepted Answer

The stimulus package causing prices to fall in many sectors would actually be a positive effect on the economy as it would increase the purchasing power of consumers and businesses, leading to an increase in overall spending and economic growth. Therefore, this cannot be a reason why the stimulus package did not have a strong impact on GDP and unemployment.

Which of the Following Is Not a Reason Why the Stimulus