All of the following are examples of fiscal policy EXCEPT:
A)increasing Medicaid reimbursements.
B)reducing the money supply to raise the interest rate.
C)increasing personal income tax deductions for home ownership.
D)reducing federal subsidies to state universities.

Question

Quizplus · Accepted Answer

Reducing the money supply to raise the interest rate is a monetary policy tool, not a fiscal policy tool. Fiscal policy refers to changes in government spending, taxation, and transfer payments to influence the economy. The other choices are all examples of fiscal policy: increasing Medicaid reimbursements is an example of government spending, increasing personal income tax deductions for home ownership is an example of tax policy, and reducing federal subsidies to state universities is an example of a cut to government spending.

All of the Following Are Examples of Fiscal Policy EXCEPT