When a government lowers taxes it is employing ________.

Question

Quizplus · Accepted Answer

Lowering taxes is a part of fiscal policy which refers to the use of government spending and taxation to influence the economy. Monetary policy (B) refers to the management of the money supply to influence the economy. Domestic policy (C) encompasses various policies related to issues within the country, but tax reduction specifically falls under fiscal policy. The law of one price (D) refers to the concept that identical goods should have identical prices in different markets.

When a Government Lowers Taxes It Is Employing ________