Abstract
The paper discusses how fiscal policy involves the tools of taxes or government spending to stabilize the economy as it transitions through the business cycle. The paper explains that periods that are characterized by recessionary or inflationary pressure can be alleviated with the appropriate expansionary and contractionary fiscal policy respectively.

From the Paper
"Fiscal policy involves the tools of taxes or government spending to stabilize the economy as it transitions through the business cycle; that is periods that are characterized by recessionary or inflationary pressure can be alleviated with the appropriate expansionary and contractionary fiscal policy respectively. Fiscal policy entails either decreasing taxes and or increasing government spending to stimulate the economy during a recession (expansionary fiscal policy) or increasing taxes and or decreasing government spending to lower inflation (contractionary fiscal policy). This paper will argue that, the United States fluctuations in the..."

Tags:fiscal, monetary, policy

Abstract
This paper deals with a general explanation of monetary policy and in what situations expansionary monetary policy should be used. This is further discussed by involving the role of interest rates and economic strength of the country, relating to most recent statistics.

From the Paper
"Monetary policy is the "attempt to moderate the business cycle and control inflation by changing the quantity of money in circulation to change interest rates" (McTaggart et al, 1999: 27.2). In another words, it is the Reserve Bank of Australia (RBA)'s attempt to change the quantity of money and interest rates so as to affect aggregate demand and, ultimately, equilibrium real GDP and the price level. McDonald defines monetary policy as the government's policy on setting the level of the money supply (1996: 149)."

Tags:aggregate, australia, bank, cash, contractionary, decline, demand, economy, equilibrium, expansionary, flow, government, inflation, interest, monetary, money, policy, rate, rates, rba, recession, reserve, supply, usa