Congress and the president would conduct contractionary fiscal policy in order to:

a. Try to control inflation,

b. Prevent the economy from falling into a recession,

c. Control the money supply,

d. Raise the budget deficit,

e. Try to stimulate the economy toward expansion.

• Congress and the president would conduct contractionary fiscal policy in order to a. Try to control inflation.

Contractionary fiscal policy is a remedy during the expansionary phase or to control inflation in the economy. Inflation is the result of increased prices in the economy due to increased demand. A government reduces spending or increases taxes to discourage people from spending more. As a result, demand for commodities will decrease, which reduces the price level in the economy.