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Which of the following is NOT a tool of fiscal policy?Choose one answer from the options below.changing tax ratesgovernment transfersgovernment purchases of goods and serviceschanges in the money supply

Question

Which of the following is NOT a tool of fiscal policy?Choose one answer from the options below.changing tax ratesgovernment transfersgovernment purchases of goods and serviceschanges in the money supply

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Solution

The correct answer is "changes in the money supply". This is not a tool of fiscal policy, but rather a tool of monetary policy, which is managed by the central bank. Fiscal policy involves the use of government spending and taxation to influence the economy.

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