Which combination of government policies is most effective in promoting economic growth?

Show Answers

Reduce taxes on savings returns, offer investment tax credits, and decrease the budget deficitRaise taxes on savings returns, grant investment tax credits, and increase the budget deficitRaise taxes on savings returns, grant investment tax credits, and reduce the budget deficitReduce taxes on savings returns, offer investment tax credits, and increase the budget deficit

Explanation

Option A is the most growth-oriented because lowering taxes on returns to saving encourages investment, investment tax credits stimulate capital formation, and reducing the budget deficit helps maintain fiscal stability, all of which support economic expansion. The other options either raise taxes on savings or increase the deficit, which can hinder growth.