In the face of unstable economic growth due to a recession or accelerating inflation, potential problems with large public debt include higher income inequality, reduced economic incentives, and crowding out of private investment.

1. Give detail of the fiscal policy, its function, and its effects on short and long-term economic fluctuations (uses the aggregate demand and supply model).

2.Explain each of the tools that exist in expansionary fiscal policy and contractionary fiscal policy.

3.Give detail of the effects of expansionary and contractionary fiscal policy on income and the price level.

4. Using the premise presented as a basis, what is the intervention of fiscal policy as an instrument to promote growth, sustainability, and economic stability in a country and provide an example