What is fiscal policy primarily concerned with?

Fiscal policy is primarily focused on the use of government spending and taxation to influence a nation's economy. This involves the government's decisions about how much money to spend on various services and projects and how much to collect in taxes. By adjusting these two levers, the government can stimulate economic growth during downturns by increasing spending or cutting taxes, and it can also cool down an overheating economy by reducing spending or increasing taxes. This mechanism plays a crucial role in managing economic fluctuations and aims to achieve objectives such as full employment, price stability, and sustainable economic growth.

The other choices address concepts related to economic policy but are associated with different realms. The regulation of monetary supply pertains to monetary policy, which involves managing the amount of money in circulation and interest rates, typically handled by a central bank. The establishment of trade tariffs relates to international trade policies aimed at protecting domestic industries. The control of interest rates is also part of monetary policy rather than fiscal policy, as it deals more with managing the economy through the banking system.