The Two Most Severe Recessions of the Post-World War II

Multiple Choice

The two most severe recessions of the post-World War II era occurred in 1981-1982 and 2008-2009. The policy responses to the two recessions were

A) very similar; expansionary fiscal policy promoted a strong recovery in both cases
B) very similar, but the recovery was nonetheless weak in both cases
C) dramatically different; tax rates were cut and monetary policy was restrictive during the earlier recession, while government spending was increased sharply and monetary policy highly expansionary during the more recent recession
D) dramatically different; tax rates were increased and monetary policy was highly expansionary during the earlier recession, while tax rates were cut and monetary policy was restrictive during the more recent recession