passwella.
Menu

JAMB Economics 2013 Question 31

Question 31

Public Finance

An example of an expansionary fiscal policy action is

  1. A.decrease in the corporate profit tax rates.
  2. B.decrease in welfare payments.
  3. C.purchase of government securities.
  4. D.decrease in the bank rate.
Show the answer and explanation

Answer: A (decrease in the corporate profit tax rates.)

Explanation

Fiscal policy uses taxes and government spending. Cutting company tax leaves firms more to spend and invest, which expands the economy.