Fiscal Policy

Who is in charge of fiscal policy?

• Government
• Reserve Bank of Australia

Taxing & spending to help the economy grow (increase GDP) is referred to as

• expansionary policy
• monetary policy
• contractionary policy
• budget deficit

Taxing & spending to slow (decrease GDP) the economy is referred to as 

• budget surplus 
• monetary policy
• contractionary policy
• budget deficit

An example of expansionary fiscal policy would be

• decreasing taxes.

• decrease government spending

If the unemployment rate is rising and GDP is falling, the fiscal policy action that the government should MOST likely follow is 

• decreasing taxes.
• decreasing spending.

If and economy experiences inflation, which fiscal policy action could be taken?

• Reducing government spending
• Increasing govt spending

An example of expansionary fiscal policy would be

• decreasing taxes and increasing govt spending

• decreasing government spending and increasing taxes

is said to occur when government spending is more than tax revenue

(a)  

government spending is less than tax revenue during a particular time period

(a)  

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