uestion 13(Multiple Choice Worth 4 points) 3.03 MC) Inemployment is rising, and the federal government wants to encourage job growth Which of the following actions would be an appropriate fiscal policy Raise taxes on small businesses. Expand open-market operations Increase fed(f)) spending Lower discount rates.

## Step 1<br />The problem is asking us to identify the appropriate fiscal policy that the federal government can use to encourage job growth when unemployment is rising. Fiscal policy refers to the use of government spending and taxation to influence the economy.<br /><br />## Step 2<br />The options provided are:<br />- Raise taxes on small businesses.<br />- Expand open-market operations.<br />- Increase federal spending.<br />- Lower discount rates.<br /><br />## Step 3<br />We need to evaluate each option based on its potential impact on job growth.<br /><br />## Step 4<br />Raising taxes on small businesses would not encourage job growth. In fact, it could discourage businesses from hiring more employees due to the increased cost of doing business.<br /><br />## Step 5<br />Expanding open-market operations and lowering discount rates are monetary policy tools, not fiscal policy tools. They are used by the central bank to control the money supply and influence interest rates, not directly to stimulate job growth.<br /><br />## Step 6<br />Increasing federal spending is a fiscal policy tool. When the government increases its spending, it injects money into the economy, which can stimulate demand and encourage businesses to hire more employees.