CIMA Exam CIMAPRA17-BA1-1 Topic 2 Question 95 Discussion

Actual exam question for CIMA's CIMAPRA17-BA1-1 exam

Question #: 95
Topic #: 2

[All CIMAPRA17-BA1-1 Questions]

Which of the following is the most likely policy response to an economic recession?

ARevaluation of the domestic currency

BDeflationary policy to prevent rising inflationary pressure

CReduce aggregate demand by raising interest rates, taxation, and reducing public expenditure.

DRaise aggregate demand by lowering interest rates, reducing taxation and raising public expenditure

Show Suggested Answer

Suggested Answer: D

by Amalia at Aug 23, 2024, 04:42 AM

Limited Time Offer

25%

Off

Get Premium CIMAPRA17-BA1-1 Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Cassi

9 months ago

I think C is the way to go, as reducing aggregate demand can help stabilize the economy.

upvoted 0 times

...

Shenika

9 months ago

I agree with Stephane, D seems like a more effective response.

upvoted 0 times

...

Stephane

9 months ago

I disagree, I believe D is the best option.

upvoted 0 times

...

Charlene

9 months ago

I'm going with C. Reducing aggregate demand sounds like a great way to get the economy back on track. Who needs growth anyway?

upvoted 0 times

Billi

8 months ago

But wouldn't raising aggregate demand by lowering interest rates also be effective in boosting the economy?

upvoted 0 times

...

Kati

9 months ago

I agree, reducing aggregate demand can help stabilize the economy.

upvoted 0 times

...

Dorothy

9 months ago

Haha, the answer is so obvious, even a monkey could figure it out! D all the way, baby!

upvoted 0 times

Margart

9 months ago

Yeah, it makes sense to raise aggregate demand during a recession.

upvoted 0 times

...

Ngoc

9 months ago

I think the answer is D, too.

upvoted 0 times

...

Kristeen

9 months ago

I think the most likely policy response is C.

upvoted 0 times

...

Denny

9 months ago

D is clearly the correct answer. Raising aggregate demand is the most effective policy response to a recession.

upvoted 0 times

Peggie

8 months ago

It's important to take action to prevent a recession from getting worse.

upvoted 0 times

...

Glennis

8 months ago

Lowering interest rates and increasing public expenditure can definitely help boost economic activity.

upvoted 0 times

...

Elinore

9 months ago

I agree, raising aggregate demand can help stimulate the economy during a recession.

upvoted 0 times

...