What is the difference between fiscal and monetary policy – bear in mind, I am a GCSE student!?
Very simply, fiscal policy deals with government income and expenditure, while monetary policy deals with managing the money supply. Some definitions. The term fiscal policy refers to the expenditure a government undertakes to provide goods and services and to the way in which the government finances these expenditures. http://www.finpipe.com/fiscpol.htm Monetary policy encompasses those measures employed by governments to influence economic activity, specifically by manipulating the supplies of money and credit and by altering rates of interest.