Answer:
Reduce, increase reduce
Explanation:
Expansionary policy is a deliberate action of the government aimed at achieving economic growth by injecting more liquidity into the system, that is stimulating aggregate demand by increasing the money supply . Expansionary policy can be achieved by either using the monetary policy tools or fiscal policy tools.
To achieve expansionary policy, the central bank must reduce interest rate so as to make loans attractive to borrowers.
Increase in government spending is also required to implement expansionary policy. Government spending will stimulate aggregate demand.
Reduction in taxes will increase disposable income and by extension the purchasing power of the public.
