Explain the difference between expansionary and contractionary fiscal policies

Define key terms: Expansionary - Used in deflationary gap to cause AD to shift right an stimulate economic growth (accelerator) and Fiscal - A set of government policies that increase the quantity and quality of the factors of production in a given economy by using taxation and government spending.
Draw diagram and explain it using real life example e.g. 2008 depression when the UK government bailed out the banks.

MD
Answered by Matthew D. Economics tutor

3479 Views

See similar Economics IB tutors

Related Economics IB answers

All answers ▸

Explain the term price elasticity of demand


What is a negative externality and how can you address them?


What are the distinctive characteristics of a perfectly competitive market?


State the key assumptions and characteristics of a competitive market and outline the difference between the short-run and the long-run.


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

MyTutor is part of the IXL family of brands:

© 2026 by IXL Learning