Government policies that focus on changing taxes and government spending are called ?
Correct answer: A. fiscal policies
- A. fiscal policies
- B. incomes policies
- C. supply-side policies
- D. monetary policies
Explanation
Fiscal policy uses taxation and government expenditure to influence aggregate demand, employment and economic activity. Monetary policy instead changes interest rates or the money supply.
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The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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