Multiple choice

Fiscal policy is concerned with

  1. public revenue, public expenditure and public debt

  2. controlling the BOP situation

  3. controlling the banks

  4. none of these
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A Correct answer
Explanation

Fiscal policy is the government's policy regarding public revenue (taxation), public expenditure (government spending), and public debt (borrowing). It deals with government's financial management and its impact on the economy. Balance of payments (BOP) is handled by external sector policy, not fiscal policy. Controlling banks is part of monetary policy, which is the domain of the Central Bank.

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