Fiscal Policy

key terms

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automatic stabilizers

economic fluctuations

Okun's Law

unemployment

welfare

The government’s use of its taxing and spending power to influence economic activity.

Who controls fiscal policy?

Why is fiscal policy conducted?

How is fiscal policy conducted?

What are the effects of fiscal policy on the economy?

Budgetary Balance Output Unemployment Inflation
Spending Increases
Decrease
Increase
Decrease
Increase
Spending Increases
Increase
Decrease
Increase
Decrease
Taxes Increases
Increase
Decrease
Increase
Decrease
Taxes Increases
Decrease
Increase
Decrease
Increase

General difficulties in conducting fiscal policy

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