Question
The manipulation of taxes and federal spending in order to stimulate the economy or reduce inflation is known as expansionary or contractionary (
Answers
GPT-4o mini
The manipulation of taxes and federal spending in order to stimulate the economy or reduce inflation is known as **expansionary** or **contractionary** fiscal policy.
- **Expansionary fiscal policy** involves increasing government spending or decreasing taxes to stimulate economic growth, particularly during a recession.
- **Contractionary fiscal policy** involves decreasing government spending or increasing taxes to slow down the economy and reduce inflation.
These policies are tools used by governments to manage economic performance.
- **Expansionary fiscal policy** involves increasing government spending or decreasing taxes to stimulate economic growth, particularly during a recession.
- **Contractionary fiscal policy** involves decreasing government spending or increasing taxes to slow down the economy and reduce inflation.
These policies are tools used by governments to manage economic performance.