Senator Spendital recently made a speech condemning the continuous deficits in the federal budget. He is now proposing an increase in tax rates to raise more revenue for the government and thus gradually reduce the size of the national debt over a period of several years. The strategy Senator Spendital is proposing is a common type of monetary policy.

true/false

Question

Business

Ethan Turner

8 December, 01:00

Senator Spendital recently made a speech condemning the continuous deficits in the federal budget. He is now proposing an increase in tax rates to raise more revenue for the government and thus gradually reduce the size of the national debt over a period of several years. The strategy Senator Spendital is proposing is a common type of monetary policy.

true/false

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Answers (1)

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Allisson Savage · Answer 1

The statement is: False.

Explanation:

Fiscal Policy refers to the combined governmental decisions regarding a country's taxing and spending. The term fiscal policy is associated with British economist John Maynard Keynes (1883-1946) who believed governments should influence macroeconomic productivity levels by doing such things as improving the employment rate, combating inflation, and flattening business cycles.

Thus, Senator Spendital is proposing a fiscal policy.