Final answer:
The federal government uses fiscal policy to promote economic growth and stability mainly through altering federal income tax rates, as opposed to monetary policy which involves the central bank's regulation of bank lending and interest rates.
Step-by-step explanation:
A major tool of the federal government in using its fiscal policy to promote economic growth and stability is its ability to change federal income tax rates. Fiscal policy involves government spending and taxes, and is determined by the nation's legislative body, which in the United States is Congress in conjunction with the executive branch.
This is separate from monetary policy, which is conducted by a nation's central bank, like the Federal Reserve in the U.S., and involves policies that affect bank lending, interest rates, and financial capital markets.