Monetary and Fiscal Policy monetary policy is the plan to expand or contract the money supply in order to influence the cost and availability of credit. Fiscal policy is another tool for the government basically spending and taxing, or borrowing money. Throughout this essay I will be writing about these two policies. I will be basically comparing and contrasting them. Monetary policy is more along the lines to help the nation? s money supply and help credit so the economy can gain certain things. Fiscal policy helps control the taking, borrowing and spending.
Monetary policy comes with different plans to help, such as the easy money supply which helps expand the money supply, it increases aggregate demand, and promotes economic growth. Tight Money Policy is the higher interest rates and the money supply. Fiscal policy is like missing money. What do I mean by missing money? Well, when you got your first paycheck at work didn? t you wonder why is your paycheck so little or less then what you expected? Well that? s what I mean by? missing money. ? This? missing money? goes to federal, states, and local governments as taxes. Another example would be when your purchasing an item and the price tag says $30 and when the item is registered the total is $32.
The Term Paper on Zero Inflation Policy Unemployment Monetary
Introduction Hyper inflation has plagued most of the worlds developing countries over the past decades. Countries in the industrialised world, too, have at times dulled with dangerously high inflation rates in the post WWII era. With varying degrees of success, all have employed great efforts to bring their inflation rates within acceptable limits. Generally, a moderate rate of inflation has been ...
48. That? s the taxes making the price rise a little higher. In my opinion, what I basically think is that monetary policy goes for the banking system to achieve money. For example, say that they offer C.
D. ? s and say I put $3000 in a C. D at my bank and 6 months later its not $3600. So they borrowed my money to use it for there needs and than they give it back to me with some interest.
Fiscal policy works more along the lines of taking money out of paychecks and then return them to you when you file for your income taxes. I think the Federal government thought of a good way on getting the money they are now receiving, I really have no problem because in the end we get our money back, or they should return most of our money back at least.
