Economics 9708 · AS & A Level · Fiscal policy

Fiscal policy — practice question

To strengthen its financial position, a government chose to cut spending on investment in the public sector. Economic growth did not decrease. What was the most likely effect of the government’s action?

  • AAn original budget deficit was reduced.
  • BAn original budget surplus was reduced.
  • CConsumer expenditure decreased.
  • DPublic sector productivity decreased.

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