Which of the following describes government decisions on spending and taxation to influence the economy?

Fiscal policy refers to the use of government spending and taxation to influence the economy. This includes decisions made by the government regarding how much money to spend on public services, infrastructure, and various programs, as well as how to structure tax rates and tax collections. The goals of fiscal policy can be to promote economic growth, reduce unemployment, and maintain stable prices.

When the government increases spending or reduces taxes, it aims to stimulate economic activity by increasing consumer demand. Conversely, if the government decreases spending or raises taxes, it can help to cool down an overheated economy. This balance is essential for managing the overall health of the economy.

In contrast, monetary policy involves the control of the money supply and interest rates by central banks, which is separate from fiscal policy. Organizing and leading do not pertain to economic strategies regarding spending and taxation. They focus more on management techniques and leadership styles rather than economic influence through government decisions. Therefore, fiscal policy is the precise term that captures the essence of government actions to manage economic performance through spending and taxation.