Question

Which among the following is not a tool, of fiscal policy ?
1) Government expenditure
2) taxation
3) transfer payments
4) Bank Rate​

Answer 1

Answer:

2) taxation is not a tool of fiscal policy.

Answer 2

Concept:

Fiscal policy refers to the expenditure or taxes that causes the change in IS curve.

Given:

Which among the following is not a tool, of fiscal policy that are Government expenditure, taxation, transfer payments, Bank Rate.​

To find:

Which among the following is not a tool, of fiscal policy is to find out.

Solution:

Bank rate is the tool of monetary policy not fiscal policy. The fiscal policy is determined by the government. The money supply is determined by the central bank of country. The bank rate is the discount rate that is charged to control the money supply into an economy.