GK
BUSINESS ECONOMICS
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
Decrease exports
|
|
|
Increase taxes
|
|
|
Increase government spending
|
|
|
Decrease government subsidies
|
Detailed explanation-1: -An increase in public spending or a reduction in the level of taxation might be done by a government in order to encourage and support economic growth.
Detailed explanation-2: -Increased government spending is likely to cause a rise in aggregate demand (AD). This can lead to higher growth in the short-term. It can also potentially lead to inflation.
Detailed explanation-3: -In response to the financial slowdown and its impact on the economy, the government plays a key role by increasing its spending in order to boost economic growth.
Detailed explanation-4: -Which of the following is a reason a government might increase government spending? It is concerned that the unemployment rate is too high.
Detailed explanation-5: -Fiscal policy is the use of government spending and taxation to influence the economy. Governments typically use fiscal policy to promote strong and sustainable growth and reduce poverty.