Overview
Fiscal policy is a vital tool used by governments to influence economic activity through spending and taxation. By adjusting these levers, governments can stimulate growth, reduce unemployment, and control inflation. Understanding fiscal policy helps us grasp how economic stability is achieved and m...
Key Terms
Example: Increasing spending to boost the economy.
Example: Funding for education and infrastructure.
Example: Income tax and sales tax.
Example: A deficit occurs when expenses are higher than tax income.
Example: GDP growth over a year.
Example: Increased government spending leads to higher consumer spending.