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keshav kumar

· started a discussion

· 1 Months ago

really. are of 10th fail (Question:376775.0)

please read NCERT BOOKS AGAIN

Question:

     Which among the following is not an instrument of fiscal policy?

Options:
A)

  Taxation 

B)

  Public expenditure 

C)

  Public debt 

D)

  Credit Rationing 

Solution:

Fiscal policy is the means by which a government adjusts its spending levels and tax rates to monitor and influence a nation's economy. It is the sister strategy to monetary policy through which a central bank influences a nation's money supply. These two policies are used in various combinations to direct a country's economic goals.

Credit rationing is the limiting by lenders of the supply of additional credit to borrowers who demand funds, even if the latter are willing to pay higher interest rates. It is an example of market imperfection, or market failure, as the price mechanism fails to bring about equilibrium in the market.

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