During a mild recession, the government decides to implement an expansionary policy to stimulate the economy. Which of the following actions would most effectively encourage businesses to invest and, in turn, reduce unemployment?

During a mild recession, the government can encourage businesses to invest by lowering interest rates. When interest rates are lower, it becomes cheaper for businesses to borrow money. For example, if a company wants to expand its factory, it can take out a loan at a lower cost, making that investment more appealing. As businesses invest more, they need to hire more workers, which helps reduce unemployment. This process helps the economy grow by increasing production and boosting consumer spending.