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Alik [6]
3 years ago
7

Think about factors of production; how does the government stimulate production? What are some of the steps that governments (li

ke in the USA) can take to stimulate both consumer participation and entrepreneurship in the marketplace?
Social Studies
1 answer:
zysi [14]3 years ago
6 0

Answer:

The factors of production are labor, capital, and land.

The government can stimulate production by implementing expansionary fiscal and monetary policy. Expansionary fiscal policy consists in increasing government spending and/or lowering taxes. Expansionary monetary policy consists in lowering interest rates to stimulate investment, by increasing the money supply in the economy.

The US government often employs expansionary fiscal and monetary policy to boost the economy in times of when activity is lagging. It also implements other policies like promoting research, helping foster relations between the public sector, the academic sector, and the private sector in other to boost innovation, and granting cheap credits to entrepreneurs who have original ideas to test in the marketplace.

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