Explain the difference between expansionary and contraction fiscal policies.

Expansionary and contractionary fiscal policies are two types of policies that intend to increase and decrease the money supply, respectively. An increase in the money supply through expansionary fiscal policy helps the economy during the recession phase. On the other hand, the decrease in money supply through contractionary fiscal policies helps the economy during the boom phase. Thus, one can conclude that there are many differences between expansionary and contractionary fiscal policies as both are used in different situations. However, both expansionary and contractionary fiscal policies' objective is to maintain financial stability in the economy.