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Title: What is Fiscal Policy?
Description: Documentation explaining Fiscal Policy and its purpose.
Description: Documentation explaining Fiscal Policy and its purpose.
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Fiscal Policy
Fiscal policy aims to alter levels of the total demand in the economy by using changes in: I) Taxation
II) Government Spending
...
For example a reduction in taxes will mean people
might have higher disposable incomes
...
So businesses can benefit from rising sales
...
To conclude so far, an expansionary fiscal policy can be used to I) Increase GDP Growth II)
Reduce Unemployment III) help business
...
So businesses suffer from falling sales
...
For Example a rise in taxes
will mean people have to lower disposable incomes
...
In
this way a contra dictionary fiscal policy can be used to prevent or bring down the rate of inflation
...
For example the
government could increase spending on schools by £2 billion
...
II) When these workers spend their wages in the shops, businesses will benefit from
increasing sales and increasing profits
...
Expansionary fiscal policy can be unpopular because if the government try to reduce inflation, then
taxes will increase for everyone
...
Title: What is Fiscal Policy?
Description: Documentation explaining Fiscal Policy and its purpose.
Description: Documentation explaining Fiscal Policy and its purpose.