Which of the following would be classified as fiscal policy?
A) The federal government cuts taxes to stimulate the economy.
B) States increase taxes to fund education.
C) A state government cuts taxes to help the economy of the state.
D) The Federal Reserve cuts interest rates to stimulate the economy.
E) The federal government passes tax cuts to encourage firms to reduce air pollution.
A
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Using the above figure, if the government levies a new unit tax in this market, S represents the original supply curve, and St represents the after-tax supply curve, then the after-tax price paid by consumers is the vertical distance from the origin
to A) point A. B) point B. C) somewhere between point B and point A. D) point F.
Suppose the currency price of the U.S. dollar in terms of the Japanese yen starts to fall. To prevent that from occurring, the U.S. central bank should
A) use U.S. dollars to buy Japanese goods. B) use yen reserves to buy U.S. dollars in the foreign exchange market. C) sell U.S. dollars in the foreign exchange market in exchange for yen. D) buy both U.S. dollars and yen in the foreign exchange market.