Wednesday, February 3, 2010

True or False: The federal budget is to support monetary policy that encourages investment?

In regard to the question, this is for a test correction.





Please explain why for your answer.True or False: The federal budget is to support monetary policy that encourages investment?
That I believe is false. Monetary policy is set by the Federal Reserve which has nothing to do with the federal budget.





Laws may be passed by congress to encourage investments such as depreciation allowances, special subsidies, and special tax rules. But this does not directly relate to the budget process although it certainly can effect the government budget just as government handouts can.

No comments:

Post a Comment