Fiscal policy measures imply a change in
Only taxation to control aggregate demand
Bank rate to infulence lending
Only government expenditure to regulate an economy
Government revenue and expenditure to regulate an economy
Correct answer is D
Fiscal policy is the use of government income and expenditure instrument to regulate or control the economy. It is used to control inflation, deflation, balance of payments deficits, economic recession, unemployment, price level, GNP etc. The two most important fiscal policy tools of government are: Government expenditure and Taxation.