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The Australian Government have macroeconomic objectives, full employment, price stability, external balance and economic growth. To for full these objectives the government use 2 main policies, a Fiscal policy which deals with the commonwealth's plans and actions to influence economic active though taxation and Government spending. The second policy is the Monetary policy. Its purpose is to increase or decrease aggregate demand (AD) depending on the economic activity and to manage inflation.

It is helpful to think of the Fiscal policy has the governments budget policy because it consists everything the government will spend its money on for the next 12 month. The government will spend its money on things like defence, environmental programs and Medicare. It also talk about how the governments taxation system. There are 2 types of Fiscal policy. The Contractionary Fiscal Policy which is dub as the surplus policy. This is where a government will plan to spend less money than what......

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Approximate Word Count: 514
Approximate Pages: 3 (250 words per double-spaced page)

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