Question : The Fiscal policy achieves the macroeconomic goals by using which of the following instruments?
Option 1: Taxes
Option 2: Statutory Liquidity Ratio
Option 3: Cash reserve ratio
Option 4: Bank rate
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Correct Answer: Taxes
Solution : The correct option is Taxes .
Governments can adjust tax rates and policies to influence disposable income for individuals and businesses. Tax cuts can boost spending and economic activity, while tax hikes can have the opposite effect.
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