Question

An economy had a cyclically adjusted surplus of one year of zero percent of GDP that was 2.3 percent of GDP the next year. this suggests that the government during that period multiple choice did not change its discretionary fiscal policy.

a) cut taxes and/or increase spending.
b) changed policy from neutral to contractionary.
c) wanted to stimulate the economy.

Answer 1

During the 2008-2009 Great Recession, the U.S. government implemented expansionary fiscal policy through a combination of tax cuts and increases in government spending.

Step-by-step explanation:

During the 2008-2009 Great Recession, the U.S. government implemented expansionary fiscal policy through a combination of tax cuts and increases in government spending. This bipartisan effort, known as the federal stimulus, aimed to stimulate the economy and address the extreme economic situation at that time. However, the federal stimulus was partially offset when state and local governments began cutting their spending due to budget constraints caused by the recession.