Which group is most able to use money to influence the overall economy?

• A. Local businesses
• B. The central government
• C. Individual households
• D. Non-profit organizations

Answer: (B)

Verified step by step guidance

1. Understand the role of each group in the economy: local businesses, individual households, non-profit organizations, and the central government.
2. Recognize that the central government has the unique ability to influence the overall economy through fiscal policy, such as government spending and taxation.
3. Note that local businesses, individual households, and non-profit organizations primarily influence the economy on a smaller scale, through their spending, saving, and investment decisions.
4. Recall that the central government can also influence the economy indirectly through monetary policy by working with the central bank to control money supply and interest rates.
5. Conclude that because of these broad and powerful tools, the central government is the group most able to use money to influence the overall economy.