Question

Fiscal policy is determined by

a. the president and the federal reserve.
b. the federal reserve.
c. congress and the federal reserve.
d. congress and the president.

Answer 1

Fiscal policy is determined by d. Congress and the President and involves the government's use of taxation and spending to influence the economy.

Step-by-step explanation:

Fiscal policy is the government's use of taxation and spending to influence the overall state of the economy. In the United States, fiscal policy is determined by Congress and the President. Congress is responsible for passing laws that determine the level of government spending and taxation, while the President, with the help of economic advisers and the Office of Management and Budget, outlines the budget and proposed spending priorities.

For example, during an economic recession, the government may implement expansionary fiscal policy by reducing taxes to encourage consumer spending and increasing government spending on infrastructure projects to stimulate economic growth. Conversely, during times of inflation, the government may implement contractionary fiscal policy by increasing taxes to reduce spending and curb inflation.