Fiscal policy is the use of taxes and government spending to shift the aggregate demand curve.

Question

Quizplus · Accepted Answer

Fiscal policy refers to the government's use of spending and taxation policies to affect the economy and influence aggregate demand, which is the total amount of goods and services that consumers and businesses are willing to buy at a given price level. By adjusting the levels of government spending and taxation, policymakers can influence consumer and business spending, investment levels, and overall economic growth. Therefore, fiscal policy is used to shift the aggregate demand curve, making A the correct answer.

Fiscal Policy Is the Use of Taxes and Government Spending