If the government is required to balance its budget in every financial year, this policy will:

a.

Destabilize the economy as the government needs to increase spending during recessions and decrease spending during booms.

b.

Stabilize the economy as the government needs to reduce spending during recessions and increase spending during booms.

c.

Stabilize the economy as the government needs to reduce spending during recessions and increase spending during booms.

d.

Destabilize the economy as the government needs to reduce spending during recessions and increase spending during booms.

e.

All of the answers here are incorrect