Which of the following is NOT True regarding Fiscal

Policy?

A To maintain and achieve full employment Correct Answer Incorrect Answer

B To stabilize the price level Correct Answer Incorrect Answer

C To stabilize the growth rate of the economy Correct Answer Incorrect Answer

D To maintain deficit in Balance of Payments Correct Answer Incorrect Answer

E To promote economic development Correct Answer Incorrect Answer

Solution

Fiscal policy is the means by which a government adjusts its spending levels and tax rates to monitor and influence a nation's economy. It is the sister strategy to monetary policy through which a central bank influences a nation's money supply. The main objectives of Fiscal Policy are: •To maintain and achieve full employment •To stabilize the price level •To stabilize the growth rate of the economy •To maintain equilibrium in Balance of Payments •To promote economic development

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