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Economics · Oct / Nov 2023 · Paper 12 · Question 22

2281Fiscal policy

Which change to fiscal policy is most likely to reduce cyclical unemployment in an economy?

  1. Aincreasing direct taxation
  2. Bincreasing the budget deficit
  3. Cincreasing the budget surplus
  4. Dincreasing the money supply

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Correct answer: B. increasing the budget deficit

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