Question

What is one reason why the government would provide financial assistance to an entrepreneur?

Answer 1

The correct answer is C.

A goverment, through its fiscal policy, is able to boost or limit economic growth by modifying the tax level and the amount of public spending.

In this case, providing financial assistance means decreasing taxes charged to entrepreneurs. Such expansionary fiscal policy aims to foster investment and therefore, its ultimate goal would be to increase aggregate demand and to produce economic growth.

Answer 2

to stimulate the economy while decreasing unemployment