Which of the following would be considered as tools of economic stimulus?

1. Increasing taxes so that government has more money to spend
2. Quantitative Easing
3. Decreasing Interest Rates

Select the correct statements using the codes given below:
a) 1 and 2 only
b) 1 and 3 only
c) 2 and 3 only
d) 1, 2 and 3

Ans-c

Explanation-An economic stimulus is the use of monetary or fiscal policy to stimulate lagging or struggling economy. Government can use tactics such as lowering interest rates, and quantitative easing mainly to achieve this.

Lowering taxes enables increase of consumer spending which helps economy to recover from the recession. Thus Option c