Although fiscal policy mainly covers state legislation on taxes and costs
Although fiscal policy mainly covers state legislation on taxes and costs, monetary policy seeks to control economic growth (stimulus or oppression) by managing interest rates and financial financing. Like tax policy, it serves to stimulate or reduce the economy. Monetary policy primarily uses a central bank or Federal Reserve system to limit or increase the money supply that is distributed using other strategies. The Federal Reserve System determines interest rates by applying a discount rate by using open market operations (selling or purchasing government bonds that affect the amount of transactions). Adopt a new loan to a financial institution), or change the reserve percentage for the bank (when making a loan, increase or decrease the amount of money in the bank).