The two main tools of macroeconomic policy include monetary policy, and fiscal policy, which involves spending.

The two main tools of macroeconomic policy include monetary policy, and fiscal policy which includes government spending. Government spending is some money expended by the government and can be effected by any form of government subsidized operations which includes health, social services, unemployment correspondences, government payouts to banks and national defense. Government spending is a portion of fiscal policy and is used by the government to avoid the rather more spiteful side-effects of the business series. One example, the economy is being subjected to a recessionary gap, the government could help by increasing government spending. This increase in government spending would benefit the economy to grow because that same extra money will be passed onto consumers and will lead to investment, thus helping the economy out of depression.