Final answer:
Fiscal policy in macroeconomics involves government spending and tax policies to influence the economy's path over time.
Explanation:
Fiscal policy is the use of government spending and tax policy to influence the path of the economy over time. Graphically, fiscal policy shifts the aggregate demand outward in the case of expansionary fiscal policy and inward in the case of contractionary fiscal policy. It plays a crucial role in macroeconomics by adjusting aggregate demand through government spending or taxation policies.
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