Fiscal Policy

Government use of taxing and spending to stabilize the economy Fiscal Policy Government use of taxing and spending to stabilize the economy

Federal Budget Written document indicating the amount of money the government expects to receive & spend for a year

CBO (Congressional Budget Office) – helps Congress with its decisions Federal Budget OMB (Office of Management & Budget) – in the exec. dept… manages the budget CBO (Congressional Budget Office) – helps Congress with its decisions

Federal Budget Appropriations Bill – a bill that sets money aside for specific spending

Fiscal Year 12 month period… not January – December Oct. 1 through Sept 30 for government fiscal year

Expansionary Policy Fiscal policies that attempt to increase economic output, such as higher spending or tax cuts

Contractionary Policies Fiscal policies that attempt to decrease economic output, such as lower spending or higher taxes

Limits of Fiscal Policy Difficulty of changing spending levels Predicting the future Delayed results Political Pressures Coordinating Fiscal Policy

The End