Which of the following defines fiscal policy?

Fiscal policy refers to the use of government spending and taxation to influence the economy. This can involve changes in revenue generation through tax adjustments and deciding how much to spend on various public services and infrastructure. By manipulating these factors, the government can stimulate economic growth, control inflation, and reduce unemployment. For example, increasing government spending can boost economic activity during a recession, while increasing taxes might be used to cool down an overheating economy. Understanding fiscal policy is crucial for analyzing how government actions affect overall economic performance and individual financial well-being.