Question

Economists warn that the nation is slipping into a recession. Which fiscal policies will the federal government most likely take to help the economy grow?Lower taxes and decrease spending

Lower taxes and increase spending
Raise taxes and decrease spending
Raise taxes and increase spending

Answer 1

Answer: B. Lower Taxes and increase in spending

Step-by-step explanation:

Recession is a period of less productive activity , demand deficiency , deflationary gap .

Fiscal Solution is that approach to solve such issues - which uses government budgetary elements (tax , govt spending /subsidy) to adjust excess / deficient demand

To correct the demand lack while recession , government should - Reduce Taxes , Increase govt spending / subsidy . So that ,people's disposable income & hence their demand increases .

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