Monetary and Fiscal Policy Assignment Help
An Introduction to Monetary Policy and Fiscal Policy
Both of the above listed policies are perceived in the context of being widely recognized tools that have a great influence on economic activity of a nation. Precisely, the Monetary Policy deals with management of interest rates as well as handling the overall circulation of money supply. This policy is mostly put into activity and implementation by the central banks such as the U.S. Federal Reserve. On the other hand, Fiscal policy is defined as a collective term that takes care of all the government actions related to taxing and spending.
A Detailed Description of Policies as Explained in the Monetary and Fiscal Policy Assignment Help
Talking about the monetary policy first, it is widely used by the Central Banks to increase the rate of growth in an economy or simply to cross check its growth. Simply put, an economic activity is stimulated if the individuals and businesses are encouraged to borrow and spend. Fed or Federal Reserve has put into implementation 3 different policy tools which aim to make a great impact on the economy. These tools are stated as bank’s changing reserve requirements, opening market operations, and discount rate setting.
Open market operations take place on a daily basis wherein the Federal Reserve purchases and sells U.S. government bonds so that money can be infused in the economy or choose to extract money from the current circulation. To set the reserve ratio or specifying the % age of bank deposits that must be kept in reserve, Fed makes a direct impact on the amount generated when the backs initiate loans. It is also in the sole power of the Federal Reserve to change discount rate to influence impact short-term interest rates bringing a new vibe in the overall economy. Get 100% original and plagiarism free Monetary and Fiscal Policy assignment help and case study writing service on Monetary and Fiscal Policy from Phd qualified writers at reliable price.
Fiscal Policy on the other hand is aimed to regulate the entire spending level and its composition within an economy. This policy gets affected by alteration introduced in the government spending or tax policies. If the authorities realise a lack of business in the economy, they escalate the amount of money. The process is also termed “stimulus” spending. In the other scenario, when tax receipts are not sufficient to be paid, government follows the method of borrowing money by means of debt securities issue like government bonds to accumulate debt. Such process is called deficit spending.
So, the regulation of less or more money is done by government authorities. This is done by either increasing the tax rate which helps in extracting out of the economy and also results in steady business activity. However, this policy is mostly implemented in a scenario, wherein the government aim for economic stimulation. This further helps in decreasing the rate of taxes or by setting on offer some tax rebates. The basic purpose of this policy is to boost the economic growth and success rate. Get expert help writing Monetary and Fiscal Policy essay assignment from BookMyEssay.
Monetary and Fiscal Policy Homework Help Cover the Major Topic of Monetary V/s Fiscal Policy
When it comes to improving the real economy, the implementation of expansionary fiscal policy is the bets choice. On the other hand, expansionary monetary policy is a better alternative of better financial economy. This is due to the fact that both policies get through in the system via different channels to make a strong impact on individuals and corporations.
Also, the Fiscal Policy majorly works in the favour of consumers positively as it generates more employment opportunities and income. On the other hand, Monetary policy is much less influential on the real economy. Get Monetary and Fiscal Policy homework help online by qualified writers.
The expansionary monetary policy imposes very little effect on the growth by escalating the prices of the assets as well as decreasing the borrowing costs so that companies stands in a much more profitable front. Another important point of difference between these policies is that fiscal policy is easy to be targeted but monetary policy is much more rigid when it comes to expanding as well as shrinking money supply in an economy. Thus, its regulation is not that easy to influence overall inflation and growth.
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