Consider the following statements about Fiscal policy 1 Fiscal policy is the means by which a govern...........

Economic Affairs Tax System

Consider the following statements about Fiscal policy:

1. Fiscal policy is the means by which a government adjusts its spending levels and tax rates to monitor and influence a nation's economy.

2. Fiscal policy is based on the theories of British economist John Maynard Keynes.

3. Tex cut and increase government spending means contractionary fiscal policy.

Which of the above statements is/are correct?

1 and 2 Only

1 Only

2 only

All of the above

छोटे Courses बड़े Results

Master Tax System

Prepare through Micro-courses

Try Now

Explanation:

One of the many problems with fiscal policy is that it tends to affect particular groups disproportionately. A tax decrease might not be applied to taxpayers at all income levels, or some groups might see larger decreases than others. Likewise, an increase in government spending will have the biggest influence on the group that is receiving that spending.