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Economics · Oct / Nov 2022 · Paper 13 · Question 16

2281Fiscal policy

A government decides to boost the economy through the use of a budget deficit. Which target should it adopt to achieve this aim?

  1. ADirect taxation should exceed indirect taxation.
  2. BExport earnings should exceed import expenditure.
  3. CGovernment savings should exceed government investment.
  4. DGovernment spending should exceed government revenue.

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Correct answer: D. Government spending should exceed government revenue.

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