Which one of the following statements appropriately describes the ldquo fiscal stimulus rdquo ........

Economic Affairs Public Finance and Debt Management

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

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

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

It is 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

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Explanation:

Second statement is correct.
An increase in public spending or a reduction in the level of taxation that might be performed by a government in order to encourage and support economic growth. Most government bailout packages offered to various business types can be considered a form of fiscal stimulus.