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Meaning of Fiscal policy

Meaning of Fiscal policy:

Fiscal policy is the set of decisions and principles of a government regarding the extent of public expenses and mode of financing them. It is about the attempt of government to persuade the economy’s output, employment and prices by modifying the level of public expenses, taxation and public debt. Arthur Smithies indicates, “Fiscal policy is a policy beneath which the government employs its expenses and revenue programs to generate desirable effects and shun undesirable effects on the national income, employment and production”

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