Fiscal policy refers to the idea that aggregate demand is affected by changes in
A)the money supply.
B)government spending and taxes.
C)trade policy.
D)interest rates.

Question

Quizplus · Accepted Answer

Fiscal policy involves government decisions on taxation and spending to influence the economy. Changes in government spending and taxes directly affect aggregate demand, as they alter consumers' disposable income and incentives to spend or save.

Fiscal Policy Refers to the Idea That Aggregate Demand Is