Which of the following statements is true?
A)Fiscal and monetary policy influence only economic growth.
B)Fiscal policy influences only economic fluctuations, and monetary policy influences only economic growth.
C)Fiscal and monetary policy influence only economic fluctuations.
D)Fiscal policy influences only economic growth, and monetary policy influences only economic fluctuations.
E)Fiscal and monetary policy influence both economic growth and economic fluctuations.

Question

Quizplus · Accepted Answer

Fiscal policy, which involves changes in government spending and taxation, can be used to stimulate or slow down economic growth and to address economic fluctuations such as recessions or inflation. Monetary policy, which involves changes in interest rates and the money supply, can also be used to influence both economic growth and fluctuations, such as adjusting interest rates to encourage borrowing and spending during a recession, or slowing down the growth of the money supply to combat inflation.

Which of the Following Statements Is True