An example of expansionary fiscal policy is
A) an increase in government spending,or an increase in taxes,or both.
B) a decrease in government spending,or a decrease in taxes,or both.
C) an increase in government spending,or a decrease in taxes,or both.
D) a decrease in government spending,or an increase in taxes,or both.
E) holding government spending constant while increasing taxes.

Question

Quizplus · Accepted Answer

Expansionary fiscal policy aims to stimulate economic growth and increase demand. This can be achieved by increasing government spending, reducing taxes, or both. An increase in government spending can lead to more jobs, higher income, and increased demand for goods and services. Meanwhile, a decrease in taxes can increase disposable income and encourage spending. Thus, the correct option is choice C, which involves an increase in government spending or a decrease in taxes, or both.

An Example of Expansionary Fiscal Policy Is