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In order to encourage economic growth which policy (monetary or fiscal) should be used to fight inflation

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Answer:

Monetary policy.

Step-by-step explanation:

A Monetary policy regulates interest rates and the quantity of supplied money that is in circulation, it is the central banks that manage it. The Fiscal policy is related to the taxes and spending of the governments, it is managed by legislation.

Both policies are important for the economy, but Monetary policy can be used to encourage economic growth as it incentives people and business to borrow and spend, or to do savings and it should be used to fight inflation.

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User Gaurav Khurana
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