Question

Which of the following is not a goal of fiscal policy?

price stability

full employment

economic growth

increased currency



Increasing government spending usually

increases the unemployment rate.

decreases the unemployment rate.

increases the stagflation rate.

decreases the stagflation rate.

Answer 1

The answer to the first question is "increased currency". As for the second question, it is dependent on the nature of the government spending. If the spending is channelled to production, it can increase productivity, reduce unemployment rate and improve standard of living. But, the government spending is wrongly channelled, it can result to stagflation