The text presents a question regarding economic policy. It states:---**The government wants to encourage consumer spending through cutting income taxes. This is an example of:**- ○ a monetary policy- ○ a supply-side policy- ○ a fiscal policy- ○ an incomes policy---This question is designed to assess understanding of different types of economic policies used by governments to influence the economy. - **Monetary policy** refers to how a central bank or other regulatory authorities manage the money supply and interest rates.- **Supply-side policy** involves measures to increase the productive capacity of the economy.- **Fiscal policy** involves government spending and tax policies used to influence economic conditions.- **Incomes policy** involves measures to control wages and prices to curb inflation.For this particular question, cutting income taxes to encourage consumer spending is an example of a **fiscal policy**.

Introduction We have two types of markets: the goods market and the money market. The goods market…

Answered: The government wants to encourage…

The government wants to encourage consumer spending through cutting income taxes. This is an example of a monetary policy a supply-side policy a fiscal policy an incomes policy

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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