Economics Fiscal Policy Questions
Fiscal policy refers to the government's use of taxation and spending to influence the overall economy. It involves decisions on how much the government should spend, how it should finance its spending, and how it should tax individuals and businesses. Fiscal policy aims to stabilize the economy, promote economic growth, and address issues such as unemployment and inflation.
On the other hand, fiscal sustainability refers to the ability of a government to maintain its fiscal policy over the long term without jeopardizing its financial stability. It focuses on ensuring that government revenues are sufficient to cover its expenditures, including debt servicing costs, without leading to excessive borrowing or unsustainable levels of debt. Fiscal sustainability involves making prudent decisions on spending, taxation, and borrowing to ensure the government's fiscal position remains stable and viable in the long run.