When the Government Attempts to Stabilize the Economy by Changing

question 8

True/False

When the government attempts to stabilize the economy by changing taxes or government expenditures, it is using fiscal policy.

---

Definitions:

Bond Prices

The market price at which a bond is traded, which can fluctuate based on interest rates and the bond’s credit rating among other factors.

The National Post

A Canadian English-language national newspaper.

Term Structure

Pertains to the connection between interest rates or yields on bonds and varying durations or maturities.

Interest Rates

The percentage charged on the total amount of borrowed money or paid on deposited funds.