For example , while it is a recession , it uses expansionary fiscal policy , which means to increase government spending and to cut taxes . Instead , contractionary fiscal policy is used when the economy is overheated , and assumes the reduction in government spending and increase in taxes . Direct wage-controls - incomes policies set limits on the rate growth of wages and is aimed to reduce cost inflation . As it was mentioned previously there are two methods - voluntary and statutory . Among long term policies to...











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