Question

If you were the Minister of Finance taking care of fiscal policy, which one of the...

If you were the Minister of Finance taking care of fiscal policy, which one of the following could you implement?

Select one:
a. An increase in federal transfer payments
b. An increase in spending to military bases
c. A tax increase
d. All of these ideas could be implemented
e. A cut in social security programs
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Answer #1

Option (d) is correct

All of the given options / ideas could be implemented.

Fiscal policy aims at improving the economic performance and promoting the sustainable growth rate of the economy. Fiscal policy is implemented by two ways. One is Government spending and the other is taxation. Government controls the fiscal policy by these two measures. An increase in federal transfer payments, an increase in spending to military bases and a cut in social security programs are part of Government spending while a tax increase is taxation part.

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