Question

Fiscal policy helps the government manage the economy by:
A. spending tax money during difficult economic times.
B. setting the level of unemployment for the year.
C. deciding on the proper money supply in the country.
D. setting environmental regulations for businesses.​

Answer 1

Answer:

A. spending tax money during difficult economic times.

Explanation:

Answer 2

The fiscal policy helps the government manage the economy by spending tax money during difficult economic times. Thus the correct option is A.

What is Fiscal policy?

Fiscal policy can be defined as adjustments to governmental expenditure and taxes to accomplish the goals of macroeconomic policy. This policy is controlled by the federal government.

By using tax receipts to make investments during adverse economic times, fiscal policy contributes to managing the nation's economy. Governments affect the economy via modifying tax rates, spending amounts and borrowing amounts to stimulate demand.

Therefore, option A is appropriate.

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