Suppose the economy had an unemployment rate of 6.9%, and an inflation rate of 0.8%.What would be an appropriate counter-cyclical fiscal policy?

a.Buying Treasury bonds from banks.

b.Increasing government spending on road construction.

c.Raising the discount rate.

d.Increasing marginal income tax rates.

Which of the following is a counter-cyclical monetary policy when the economy is experiencing a recession?

a.A decrease in the required reserve ratio.

b.A decrease in Federal government purchases.

c.SellingTreasury bonds to banks.

d.A decrease in taxes.

Which of the following is a counter-cyclical fiscal policy when the economy is experiencing a recession?

a.A decrease in the required reserve ratio.

b.An increase in the federal funds rate.

c.An increase in transfer payment spending.

d.An increase in taxes.