Post Utme Ui 2021 Economics Question 26

Practice objective / multiple choice question 26 from the 2021 Post Utme Ui Economics examination.

Post Utme Ui 2021 Economics Objective / Multiple Choice
Question 26 POST_UTME_UI • 2021 • ECONOMICS • objective

Consider a country with a mixed economy, where the government plays a significant role in the allocation of resources. U\sing the concept of fiscal policy, explain how the government can use taxation to influence the level of aggregate demand in the economy.

Answer Options

A. The government can increase taxes to reduce aggregate demand, thereby reducing inflation.
Correct Answer B. The government can decrease taxes to increase aggregate demand, thereby stimulating economic growth.
C. The government can use taxation to redistribute income from the rich to the poor, thereby increa\sing aggregate demand.
D. The government can use taxation to reduce the budget deficit, thereby increa\sing aggregate demand.
Correct Answer
B
Correct Option:
The government can decrease taxes to increase aggregate demand, thereby stimulating economic growth.

About This Question

This is Post Utme Ui 2021 Economics Question 26. It is one of the objective questions from the 2021 Post Utme Ui Economics examination.

View More Post Utme Ui 2021 Economics Questions More Post Utme Ui Practice Questions Back to Questions

Master the Exam!

You've seen a preview, but there are thousands more questions plus AI tutor to break down complex solutions.

Unlock Full Access Available for Android & Windows
Chat with Support