Given that an economy is experiencing inflation in the 56% range and the Federal debt is at an all-time high. design an economic policy (that uses one or both of fiscal and/or monetary policy )to reduce the rate of inflation Make sure your exploration addresses the following Define what fiscal policy is Explain the strengths and weaknesses of fiscal policy Define what monetary policy is Explain the strengths and weaknesses of monetary policy Given that the actual policy choice is somewhat normative in nature. outline the policy you would choose to use and justify the policy based on the strengths and weaknesses of your options 6. Describe which macroeconomic theory we reviewed you used as a basis to develop your policy. m-FOJNl-l Answer Inflation happens when an economy grows because of increased spending. At the point when this occurs ,costs rise and the currency inside the economy is worth less of what it was previously. Also, the currency basically won't accepting as much as it would previously. At the point when a currency is worth less, its conversion scale debilitates when contrasted with different monetary standards. An ascent in inflation is probably going to mean an ascent in the expense of raw materials. Additionally, laborers are probably going to request higher wages to adapt to the greater expense of living. This ascent in costs can likewise cause more volatility and vulnerability. There are numerous methods used to reduce high inflation rate and control inflation, its either by utilizing fiscal or monetary policy. Fiscal policy alludes to the tax and spending policies of a country's administration. A tight, or restrictive fiscal policy incorporates increasing government rates and scaling back bureaucratic spending. A loose or expansionary fiscal policy is the exact inverse and is utilized to support economic growth Strengths of utilizing fiscal policy The government can coordinate spending toward explicit ventures. areas or districts to stimulate the economy where it is seen to be expected to most . ' Taxing polluters or those that abuse limited assets can help eliminate the negative impacts they cause while producing government income ' The impacts of fiscal policy tools can be seen a lot faster than the impacts of monetary tools