Economics · Fiscal Policy Effectiveness
Which of the following statements regarding fiscal policy effectiveness is CORRECT?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1It is ineffective in recession
- 2It always crowds out private investment fully
- 3It has no role in stabilisation
- 4It is more effective in liquidity trap✓
Correct answer
It is more effective in liquidity trap
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