The government wants to encourage consumer spending through cutting income taxes. This is an example of
A) an incomes policy.
B) a fiscal policy.
C) a supply-side policy.
D) a monetary policy.

Question

Quizplus · Accepted Answer

Cutting income taxes is a measure that falls under fiscal policy, which involves the government's use of taxation and spending policies to influence the economy. The objective of cutting income taxes is to stimulate consumer spending, which can lead to increased economic activity and growth. Incomes policy (A) refers to government intervention in setting and regulating wages and prices, supply-side policy (C) focuses on promoting economic growth through policies such as deregulation and tax cuts for businesses, and monetary policy (D) involves the central bank's use of measures such as interest rates and money supply to influence the economy.

The Government Wants to Encourage Consumer Spending Through Cutting Income