Question Details

	Username: Andrew Rating: Asked to: Anton Luyten Date Created: 03 Oct 2016
Category	28
Tag	Financial
Question	What is an 'Expansionary Policy'?

Advice from Guru

Hi Andrew,

An expansionary policy is a macroeconomic policy that seeks to expand the money supply to encourage economic growth or combat inflationary price increases. One form of expansionary policy is fiscal policy, which comes in the form of tax cuts, transfer payments, rebates and increased government spending. Another form is monetary policy, which is enacted by central banks and comes about through open market operations, reserve requirements and interest rates.

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