- CFA Exams
- CFA Level I Exam
- Study Session 5. Economics (2)
- Reading 16. Monetary and Fiscal Policy
- Subject 8. Active and Discretionary Fiscal Policy
CFA Practice Question
An expansionary fiscal policy is least likely to include an increase in ______.
A. tax rates
B. government borrowing
C. government expenditures
Explanation: An expansionary fiscal policy means that the government increases its purchases of goods and services and/or cuts tax rates to increase aggregate demand. As a consequence, government borrowing is likely to increase.
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