The government can help correct a recession by implementing expansionary fiscal policy that reduces to increase consumption spending and aggregate demand.

Answer 1

The government can help correct a recession by implementing expansionary fiscal policy that reduces taxes to increase consumption spending and aggregate demand. By lowering taxes, households have more disposable income, which encourages spending on goods and services. Additionally, the government can also increase its own spending on infrastructure, education, and social programs, which further boosts aggregate demand. Together, these actions aim to stimulate economic activity, reduce unemployment, and ultimately help pull the economy out of a recession.