Final answer:
Fiscal policy is the use of government spending and tax policy to influence the path of the economy. Liberals and conservatives have different viewpoints on the best use of fiscal policy.
Step-by-step explanation:
Fiscal policy is the use of government spending and tax policy to influence the path of the economy over time. It can be expansionary, in which the government increases spending or decreases taxes to stimulate economic growth, or contractionary, in which the government decreases spending or increases taxes to combat inflation. An example of expansionary fiscal policy would be a government increasing infrastructure spending during a recession to create jobs and stimulate economic activity. Liberals generally support the use of fiscal policy to address economic issues and advocate for increased government spending, while conservatives tend to favor limited government intervention and emphasize low taxes as a means to stimulate economic growth.