Which of the following is NOT a tool of fiscal policy?Choose one answer from the options below.changing tax ratesgovernment transfersgovernment purchases of goods and serviceschanges in the money supply
Question
Which of the following is NOT a tool of fiscal policy?Choose one answer from the options below.changing tax ratesgovernment transfersgovernment purchases of goods and serviceschanges in the money supply
Solution
The correct answer is "changes in the money supply". This is not a tool of fiscal policy, but rather a tool of monetary policy, which is managed by the central bank. Fiscal policy involves the use of government spending and taxation to influence the economy.
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