What is monetary policy?
a whole formed by combining several (typically disparate) elements.
Government action to make money supply and interest rates towards achieving microeconomic objectives
What are the Goals of Monetary policy?
- Price stability
- High employment
- Economic Growth
- Stability of financial statisitics
What are the two main targets monetary policy?
Interest Rate adn Money supply
What is the graph for an expansion in monetary policy?
What is a contractionary monetary policy?
type of policy that is used as a macroeconomic tool by the country’s central bank or finance ministry to slow down an economy. Contractionary policies are enacted by a government to reduce the money supply and ultimately the spending in a country.
What is the graph for the Contractioinary Monetary Supply curve?
What is a fiscal policy?
Government actions to manage taxes and government purchases to achieve macro economic objectives
What are two main components of a fiscal policy?
Government purchases and the transfer of payments
What is the main sources of government revenue?
Tax
What does tax influence?
Disposible income and consumer behaviour and investment expindeture /They also influence COP and as such influence investment and decision
