What types of policies might governments implement to combat the negative effects of a recession?

Answer:

Lowering interest rates

explaination:

During a recession, economic activity slows down, leading to decreased consumer spending and investment. One effective policy that governments can implement is lowering interest rates. This action makes borrowing cheaper, encouraging businesses and consumers to take loans for investment and spending. Increased borrowing can stimulate economic activity, helping to counteract the recession's negative effects. While cutting government spending and raising taxes can help reduce budget deficits, they may further contract the economy during a recession. Therefore, lowering interest rates is often seen as a more effective approach to stimulate growth.

Topic: Economics, Government Policy, Recession

Tags: economics recession government policy interest rates

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What types of policies might governments implement to combat the negative effects of a recession?

Question:

Choices:

Answer:

explaination: