Discuss CIMA CIMAPRA17-BA1-1 Exam Topic 1 Question 129

In a recession, the appropriate policy for a government seeking a recovery in the economy would be to:

Acut public expenditure, reduce taxes, and lower interest rates

Braise public expenditure, reduce taxes and lower interest rates

Craise public expenditure, raise taxes and lower interest rates

Dcut public expenditure, raise taxes and raise interest rates

Suggested Answer: B

Get Premium CIMAPRA17-BA1-1 Questions as Interactive Web-Based Practice Test or PDF Real Exam Format Detailed Explanations Instant Access Get Your Practice Test

24 comments · newest first

Quentin 1 day ago

I agree! Lowering taxes helps people spend more.

Rolland 6 days ago

I think option B is the best choice. More spending can boost demand.

Rosalind 12 days ago

Right, we need to think strategically.

Yoko 17 days ago

Short-term pain for long-term gain, I say!

Amalia 22 days ago

I still worry about the long-term effects of taxes.

Trina 27 days ago

Exactly! It's about boosting demand.

Rosalind 1 month ago

B balances spending and tax relief effectively.

Yoko 1 month ago

True, it could slow down recovery.

Amalia 1 month ago

What about option A? Cutting expenditure seems risky.

Trina 2 months ago

Yes, it encourages borrowing and investment.

Rosalind 2 months ago

Lowering interest rates is crucial too.

Yoko 2 months ago

Not if it's temporary and aimed at recovery.

Amalia 2 months ago

But won't raising taxes hurt people?

Trina 2 months ago

Agreed! More public spending can create jobs.

Yoko 2 months ago

I think option B is the best choice. It stimulates growth.

Andra 3 months ago

Lowering interest rates is definitely a must in any recession.

Kris 3 months ago

Cutting public expenditure is just going to make things worse!

Merri 3 months ago

Wait, how does raising taxes help during a recession?

Yvonne 3 months ago

Totally agree, raising public expenditure helps stimulate demand.

Annita 3 months ago

B is the way to go for recovery!

Jacob 3 months ago

I just can't see how cutting public expenditure would help in a recession, so I’m leaning away from A and D.

Dannette 4 months ago

I practiced a similar question, and I feel like raising public expenditure is key, so B seems right, but I’m not 100% confident.

Isreal 4 months ago

I'm not entirely sure, but I remember something about cutting taxes to encourage spending. Maybe option A?

Sabina 4 months ago

I think option B makes the most sense since raising public expenditure can stimulate demand during a recession, right?

CIMAPRA17-BA1-1 Exam - Topic 1 Question 129 Discussion