Economics 0455 · IGCSE · Fiscal policy

Fiscal policy — practice question

A government decides to stimulate the economy by using a budget deficit. Which target should it choose in order to achieve this aim?

  • ADirect taxation should exceed indirect taxation.
  • BExport earnings should exceed import expenditure.
  • CGovernment savings should exceed government investment.
  • DGovernment spending should exceed government revenue.

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