Typical fiscal policy focuses squarely on
A) aggregate demand.
B) short-run aggregate supply.
C) long-run aggregate supply.
D) government spending.
E) taxes.

Question

Quizplus · Accepted Answer

Fiscal policy is a tool used by the government to influence the economy through changes in government spending and taxes. When fiscal policy focuses on aggregate demand, it means that the government is trying to stimulate the economy by increasing spending or cutting taxes in order to increase consumer spending and investment. This is a common strategy during times of economic downturns or recessions.

Typical Fiscal Policy Focuses Squarely on