Which best explains how contractionary policies can hamper economic growth

Posted By Admin @ September 03, 2022

Question:

Which best explains how contractionary policies can hamper economic growth?

They increase consumer demand.
They can increase inflation.
They reduce taxes which raises deficits.
They reduce disposable income.

Answer:

Contractionist policies are a set of measures taken by the government, contractionary policies are measures to reduce disposable income to contain the economic growth of a certain sector, causing damage to the economy, but to know how they affect the economy, we must know this....

What is Contractionist Policy?

Contractionist Policy is a set of measures taken by the Government, with the aim of reducing the high growth of the economic market, in addition to controlling inflation and currency circulation.

Contractionist Policy is a subgroup of some other policies that make up Economic Policy as a whole, such as Fiscal, Exchange and Monetary Policies, for example.

With this information, we can say that contractionary policies are measures to reduce disposable income to curb economic growth in a given sector, causing damage to the economy.

Learn more about Economy in brainly.com/question/951950

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