In 2003, Congress passed a substantial cut in income taxes. The Federal Reserve also lowered interest rates. How can these two actions be categorized?
A) Both actions can be categorized as fiscal policy.
B) Both actions can be categorized as monetary policy.
C) The tax cut can be categorized as monetary policy and the lowering of interest rates can be categorized as fiscal policy.
D) The tax cut can be categorized as fiscal policy and the lowering of interest rates can be categorized as monetary policy.
Ans: D) The tax cut can be categorized as fiscal policy and the lowering of interest rates can be categorized as monetary policy.
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In the current international monetary system, what is the role for gold?
a. The system is a gold-exchange standard, based on a fixed value for a key currency. b. Gold backs each currency, and therefore, the system as a whole. c. It serves as the principal reserve asset. d. It has no role.
The public debt is the sum of all previous:
a. Budget deficits of the Federal government b. Expenditures of the Federal government c. Budget surpluses minus the current budget deficit of the Federal government d. Budget deficits minus any budget surpluses of the Federal government