Post Utme Osustech 2019 Economics Question 20

Practice objective / multiple choice question 20 from the 2019 Post Utme Osustech Economics examination.

Post Utme Osustech 2019 Economics Objective / Multiple Choice
Question 20 POST_UTME_OSUSTECH • 2019 • ECONOMICS • objective

A country is experiencing a recession, and the government is considering implementing a fiscal policy to stimulate the economy. Analyze the potential effects of a tax cut on the economy, including the impact on aggregate demand and the potential for inflation.

Answer Options

Correct Answer A. A tax cut will increase aggregate demand and lead to higher inflation.
B. A tax cut will decrease aggregate demand and lead to lower inflation.
C. A tax cut will have no impact on aggregate demand or inflation.
D. A tax cut will increase aggregate demand, but only in the short run.
Correct Answer
A
Correct Option:
A tax cut will increase aggregate demand and lead to higher inflation.

About This Question

This is Post Utme Osustech 2019 Economics Question 20. It is one of the objective questions from the 2019 Post Utme Osustech Economics examination.

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