Answered: The federal government's use of…

The federal government's use of taxation and spending policies to stabilize the economy is APhysical policy B Fiscal policy © Trade policy DForeign Policy

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter30: Government Budgets And Fiscal Policy

Section: Chapter Questions

Problem 14SCQ: Explain how automatic stabilizers work, both on the taxation side and on the spending side, first in...

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Concept explainers

Fiscal Policy and Money Market

Fiscal policy is one of the important tools that is used by the government to control inflation or aggregate demand in the economy. Under this policy, there are two rules which are used by the government, one is the expenditure of the government and the other is the taxation or income of the government which it collects from the public.

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