Fiscal policy most directly affects the economy by increasing or decreasing:

Question

Quizplus · Accepted Answer

Fiscal policy involves changes in government spending and/or taxes, which affect aggregate demand (the total demand for goods and services in an economy). Increasing government spending or decreasing taxes will increase aggregate demand, while decreasing government spending or increasing taxes will decrease aggregate demand. This in turn can impact economic growth, inflation, and employment levels.

Fiscal Policy Most Directly Affects the Economy by Increasing or Decreasing