The graph below is about the relationship between government debt and GDP. The y-axis is the total public debt as a percentage of GDP (for example %100 would mean that there is as much total public debt as output the U.S. economy produced that year).

Notice that this percentage tends to rise during recessions. Which factors contribute to this rise over the last two major recessions (the Great Recession and the Pandemic)? Select all that apply. more than 1 answers

graph: https://d2l.pdx.edu/content/enforced/844583-OFFERING_EC-202-003_202101/fredgraph.png?_&d2lSessionVal=mOh2wLxWhZIZWemRjuskJ2ZkE

Question 2 options:

Fall in GDP

an increase of spending in Automatic Stabilizers

an increase in discretionary government spending

an increase in austerity

b and c were wrong

Question 3(1 point)

An increase in taxes (select all that apply):

Question 3 options:

would be considered contractionary fiscal policy

would spur economic growth

reduces the multiplier

would be considered expansionary fiscal policy

Question 5(1 point)

According to chapter 14 (and John Maynard Keynes) a recession is a good time for the government to:

(select all that apply). more than 1 answers

Question 5 options:

start large public infrastructure projects.

start combating the budget deficit.

cut taxes.

cut unemployment benefits.

Question 6(1 point)

In a deflationary climate, the average consumer would:

(select all that apply)

Question 6 options:

delay spending because goods will be cheaper tomorrow.

increase spending because goods are cheaper today.

decrease savings, since the value of their savings will decrease more than normal.

increase savings, since the value of their savings will increase more than normal.

"b AND d were wrong"