Fiscal policy
What Fiscal policy means in Economics B A-Level, as defined for Pearson Edexcel.
Definitions of Fiscal policy
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Reference: Pearson Edexcel
Involves the government altering its spending and taxation, including both direct and indirect taxes, to influence aggregate demand.
Macroeconomic policy involving changes in taxation or government spending, which can be expansionary or contractionary.
A demand-side measure such as increasing taxation or increasing government spending to influence the economy.
A demand-side measure that can be expansionary, such as increasing government spending, or contractionary.
Adjusting levels of government spending and taxation to affect aggregate demand.
Topics that use Fiscal policy
- Demand-side policies (Pearson Edexcel A-Level)
- Policy instruments (Pearson Edexcel A-Level)
- The impact of macroeconomic policies (Pearson Edexcel A-Level)
Related terms
- Monetary policy
- Aggregate demand
- Aggregate demand and supply
- Automatic stabiliser
- Demand-pull inflation
- Economic indicators
- Floating exchange rate
- International trade
Using Fiscal policy in the exam
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