In the context of fiscal policy,increased taxes and reduced government spending:

A) restrict economic activities.
B) create more profits for firms.
C) increase a nation's gross domestic product
D) cut unemployment rates.

Fiscal Policy

Government spending and taxation decisions designed to control inflation, reduce unemployment, improve the general welfare of citizens, and encourage economic growth.

Increased Taxes

A financial situation where a government raises the rates of taxes, affecting individuals or businesses.

Reduced Government Spending

A situation where the government decreases its expenditure in various sectors to manage its budget, often affecting public services and investments.