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Which one of the following statements appropriately describes the “fiscal stimulus”

Which one of the following statements appropriately describes the “fiscal stimulus”?

(a)

It is a massive investment by the Government in manufacturing sector to ensure the supply of goods to meet demand surge caused by rapid economic growth.

(b)

It is an intense affirmative action of the Government to boost economic activity in the country.

(c)

It is the Government’s intensive action on financial institutions to ensure disbursement of loans to agriculture and allied sectors to promote greater food production and contain food inflation.

(d)

It is an extreme affirmative action by the government to pursue its policy of financial inclusion.

Answer:

(b)

Core Books/NCERT

Explanation

Fiscal stimulus involves increasing government spending and reducing taxes to boost economic activity, especially during downturns.