Demand, how people spend money, and the government's fiscal policy all have a part in determining?

Question

A. specialization

B. embargoes

C. the business cycle

D. price supports

Answer 1

Demand by people and demand generated by Govt. expenditure as influenced by fiscal policy influences C. the business cycle.

However, people's spending goes down in a recession and increases during recovery and expansion, while govt. spending is counter cyclical generally - it slows down during expansion and inflation and accelerates during recession and depression.

Answer 2

"C" is right one.