Fiscal Policy

Free CFA Level I lesson in Economics. 12 min read, ~1,777 words.

Monetary policy = central bank, interest rates, money supply. Fiscal policy = government, taxes and spending. Fiscal policy works through aggregate demand: G up or T down expands demand; G down or T up contracts it. Tools: spending (transfers, current, capital) and taxes (direct, indirect). Spending hits demand faster; tax...

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