Fiscal Policy Essay

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This policy is the government’s decisions that they made in regard of any taxations or spending. Two components that make up the Government’s Fiscal policy. Other than using it to stabilize the business cycle of a country, Fiscal Policy also provide for building the infrastructures, funding of scientific researches, social safety for the citizens and even national defense. It can also be used to slow down any runaway growth, sped up recoveries or even stopping an economy in free fall. It can be done by increasing or vice versa the aggregate demands (demands for all the services and goods in the economy).
Monetary policy -- This policy is how the central banks manages its money supply circulation throughout the economy, as well as interest
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Over the decades, Singapore's exports composition has evolved from labour-intensive to high value-added products, such as chemicals, electronics and even to biomedical. Singapore is also an important financial center. It is a leading foreign direct investment recipient due to its status of one of the freest, most competitive, most business-friendly economies in the world. Singapore's economic growth is the results of proper macroeconomic policies aimed at maintaining a conducive environment for long-term investment in the economy.

Monetary policy
Since 1981, monetary policy in Singapore centered on the exchange rate and controlling inflation. The Monetary Authority of Singapore, (MAS) buys and sells SGD against other currencies so that it engineers a “modest and gradual appreciation” of the SGD against the currencies of Singapore’s trade partners. The implication of this is that the interest rates in Singapore “float”. It is controlled and determined by inflows and outflows of capital, as well as trade in goods and services.

A gradually appreciating currency means a return built into holding the SGD. This policy helps underwrite Singapore’s development as a long term financial and investment hub, and stable economy. Monetary policy is reviewed on a semi-annual basis to ensure that it is consistent with economic fundamentals and market conditions, thereby ensuring low inflation for sustained economic growth over the medium

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