Which is the MOST effective fiscal policy to fight a recession if people react to uncertainty by saving all additional money that they earn or receive

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05-07-2022
Business

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Which is the MOST effective fiscal policy to fight a recession if people react to uncertainty by saving all additional money that they earn or receive

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tutorconsortium206 tutorconsortium206 · Answer 1 · 2022-07-16T04:17:51-04:00

An increase in government spending.

What is Fiscal Policy?

Government expenditure and taxation are used in fiscal policy to have an impact on the economy. Fiscal policy is often used by governments to encourage robust, long-term growth and to lower poverty. During the recent global economic crisis, when governments intervened to stabilize financial institutions, spur growth, and lessen the impact of the crisis on vulnerable individuals, the function and goals of fiscal policy rose to prominence. Fiscal policy can be classified as either neutral, expansionary, or contractionary.

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What is Fiscal Policy?

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