The government increase government spending to try to reduce unemployment This is an example of ?
Correct answer: C. fine tuning
- A. laissez-faire.
- B. monetary policy
- C. fine tuning
- D. automatic stablisers
Explanation
Increasing government spending deliberately to reduce unemployment is discretionary fiscal policy, commonly called fine-tuning. Automatic stabilisers operate without a new government decision, while monetary policy concerns money supply and interest rates.
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