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 refers to the use of government spending and taxation to influence the economy. In this scenario, the Federal government is using taxation and spending actions to stimulate the economy, making A the correct answer choice. Incomes policy refers to government intervention in wages and labor market regulations to manage inflation, monetary policy relates to the control of money supply and credit in the economy, and employment policy refers to strategies aimed at reducing unemployment rates.

When the Federal Government Uses Taxation and Spending Actions to Stimulate