Question

The country of Lilliput has high unemployment and low consumer spending, and small businesses are closing. What should Lilliput's government do to improve the economy? (5 points)

Answer 1

I believe the answer is: Lower the income tax, which gives citizens more money to spend, and buy more services from civilian-owned businesses, which creates more jobs.
Low income taxes would give small business with more profit that they could allocate toward finding new employees. This would reduce the rate of unemployment and increase the amount of money that could be used for consumption.

Answer 2

The correct answer to the exercise: The country of Lilliput has high unemployment and low consumer spending, and small businesses are closing. What should Lilliput's government do to improve the economy? Is: c. lower the income tax, which gives citizens more money to spend, and buy more services from civilian-owned businesses, which creates more jobs.

Step-by-step explanation:

To understand this question we need to analyze it. First of all, the Lower income tax effect is that citizens will pay fewer taxes for the money they make. Providing them more money to spend. Thus, this will automatically impulse the economy because they will have more money to spend. Also, they have to stimulate the markets by advising people to buy from civilian-owned businesses, which are the ones that create more jobs. So If they lower the income tax and they create a good system of supporting the small businessmen, they will improve the economy.