660
QuizMultiple Choice

Modeling with Rational Functions — Unit test

Question 660 • Crowley Credit Recovery Algebra II B

What is a potential negative effect of an expansionary policy?

Answer
A
decreased borrowing
B
increased interest rates
C
increased inflation
D
decreased available credit

Explanation

Expansionary policy boosts spending by making money and credit easier to obtain. If demand rises faster than the economy’s ability to produce goods and services, prices can rise, causing increased inflation. Decreased borrowing and decreased available credit are more associated with restrictive policy.

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