Fiscal Policies And The Fiscal Policy

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The fiscal policy is the means by which the government of a country adjusts its spending levels and the tax rates that are applied so as to monitor and influence a country’s economy. On the general scale, there are two types of fiscal policies. These are the contractionary and the expansionary fiscal policy. The expansionary policy is used mostly to spur economic growth in the times of low periods in the business years (Langdana, F. K. p.34) The contractionary policy on the other hand seeks to reduce government spending so as to stabilize the economy. There are in this form, tools that are used to implement these policies. Among these tools are, government spending and the taxation. The government spending can be adjusted in such a way…show more content…
This may be a move that pushes away potential investors in the economy, or worse, the existing ones. For the past few months, the country has suffered some form of recession, of which the experts project that the country is still recovering. This is thanks to the application of the fiscal policies that sought to strengthen the currency and reduce unemployment. Section 2 The monetary policy is basically an economic strategy and plan chosen by a country’s government in deciding the expansion or contraction of the country’s money-supply. In some cases, however, the definition runs far beyond the confines of the economic field. The monetary policy in the United States is usually implemented by the Federal Reserve. Basically, in the monetary policy, there are two broad categories. These are the expansionary and contractionary. On the general view, the expansionary policy functions to increase the money supply. This is mostly with the view of reducing the unemployment levels in the country. On the other hand, the contractionary monetary policy serves to slow the rate at which the money supply grows. This is usually in an effort to reduce inflation rates in the country. For these policies to work, however, they must be implemented. For these, there are generally about three ways of implementing the policies. These are termed as tools and they basically include the open market operations, the discount rate and the reserve requirements(Langdana, F. K. p.67) The Open
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