Fiscal policy is connected with

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(Q: 44 (IES/2000)
Fiscal policy is connected with

question_subject: 

Economics

question_exam: 

IES

stats: 

0,82,24,7,2,15,82

keywords: 

{'fiscal policy': [1, 1, 0, 2], 'economic growth': [0, 0, 3, 5], 'expenditure': [2, 0, 2, 4], 'public revenue': [0, 1, 1, 2], 'currency': [0, 1, 0, 3], 'exports': [0, 0, 2, 1], 'imports': [0, 0, 0, 1]}

Fiscal policy refers to the government`s use of taxation and expenditure to influence the economy. It is connected with various economic factors, but the primary focus is on public revenue and expenditure.

Option 1, exports and imports, is not directly related to fiscal policy. Fiscal policy mainly deals with government finances and does not directly control or regulate international trade.

Option 2, the issue of currency, is more closely related to monetary policy. Monetary policy deals with the control of the money supply and interest rates, which is the responsibility of the central bank. Fiscal policy focuses on government spending and taxation.

Option 3, economic growth, is indirectly connected to fiscal policy. By shaping government spending and taxation, fiscal policy can have an impact on economic growth. However, economic growth is influenced by multiple factors, including monetary policy, structural reforms, and external factors.

Option 4, public revenue and expenditure, is the correct answer. Fiscal policy is primarily concerned with managing government revenue (taxes) and expenditure (government spending). Through fiscal policy, the government can stimulate or dampen economic activity, influence income distribution, and address economic challenges such as inflation or recession.

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