Classify a policy by whether it changes taxation or public spending, then determine whether it expands aggregate demand or contracts demand to address inflation or recession.
Japan has faced significant periods of deflation in recent decades. Despite efforts to stimulate the economy through fiscal policy measures and monetary policy measures, economic growth remains low. Some economists have also argued that the monetary policy used by the central bank is one of the causes of low productivity in Japan.
Identify two fiscal policy measures.
Identify two fiscal policy measures.
- government spending (1)
- taxation (1)
2
If more than two measures are given, consider the first three.
Accept two types of spending, or two types of taxes.
Allow contractionary (1) expansionary (1) measures.