Case Interview Prep

Category - Economics

Fiscal policy is the use of ____________ intervention as a tool to influence economic decisions and outcomes.
  1. private enterprise
  2. federal reserve
  3. central bank
  4. government
Explanation
Answer: D - Fiscal policy is the use of government intervention as a tool to influence economic decisions and outcomes.

Key Takeaway: Governments intervene in their economies through fiscal policy. From maintaining unemployment figures at certain levels, legislating trade, and controlling money supply and inflation, fiscal policy aims to regulate economic activity. Fiscal policies are also used to provide less common interventions such as bailouts.
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