An example of stimulus spending by the government might be:
A) increase in government purchases of new cars.
B) the monthly payments a government agency makes to its employees.
C) a cut in the government budget aimed at spurring private consumption.
D) the FED engaging in open market sales of securities.

Question

Quizplus · Accepted Answer

An increase in government purchases of new cars is an example of stimulus spending by the government. This would create demand for cars, which would then lead to increased production and employment in the automotive industry.

An Example of Stimulus Spending by the Government Might Be