QUESTION

GS

Easy

Economy

Prelims 2011

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

Select an option to attempt

Explanation

A fiscal stimulus refers to a set of policy measures—specifically increased government spending or tax cuts—designed to "kickstart" a sluggish economy.

  • Why (B) is correct: It describes the government taking proactive ("affirmative") steps to increase the total demand in the economy, thereby boosting overall economic activity.

  • Why others are incorrect: (A) focuses only on the manufacturing sector, whereas stimulus is broad-based.

  • (C) describes a targeted credit policy or monetary intervention, not a broad fiscal one.

  • (D) refers to "Financial Inclusion" (bringing the unbanked into the formal system), which is a long-term structural goal, not a short-term stimulus.

Trusted by 2L aspirants

Practice UPSC Prelims PYQs Smarter

Practice Now
  • Track accuracy & weak areas
  • See past trends & repeated themes
Start Practicing Now

Crack UPSC with your
Personal AI Mentor

An AI-powered ecosystem to learn, practice, and evaluate with discipline

SuperKalam is your personal mentor for UPSC preparation, guiding you at every step of the exam journey.

Download the App

Get it on Google PlayDownload on the App Store
Follow us

ⓒ Snapstack Technologies Private Limited