When the Federal government uses taxation and spending actions to stimulate the economy, it is conducting
A) ﬁscal policy.
B) incomes policy.
C) monetary policy.
D) employment policy.

Question

Quizplus · Accepted Answer

Fiscal policy involves using government spending and taxation to influence economic activity. In this case, the government is using taxation and spending actions to stimulate the economy, which falls under the realm of fiscal policy. Incomes policy pertains to efforts to control wage and price inflation, while monetary policy involves managing the money supply and interest rates. Employment policy includes initiatives aimed at reducing unemployment and promoting job growth.

When the Federal Government Uses Taxation and Spending Actions to Stimulate