Brilliant Academy of Learning

1. Monetary Policy is formulated by RBI where as Fiscal policy is formulated by Finance Ministry of Government of India. 2. Fiscal Policy is use of Taxation and Government Spending to promote growth in the Economy. It is used to increase the rate of capital formation both in the public and private sector. Through Taxation ,Government mobilizes financial resources for financing it's various projects.It provides stimulus to increase the saving rate . It provides adequate incentives to the private sector to expand its activities. Fiscal Policy is used to reduce the imbalance of income and wealth.  3. Monetary Policy which is formulated by RBI involves measures taken to control inflation, regulate the supply of money and cost of credit in the Economy.The various instruments of Monetary Policy include variation in Bank rates , other interest rates ,supply of currency etc. in addition to that the current repo rate, reverse repo rate,marginal standing facility rate and the bank rate. 4. M...