Constant changes in market economies make it almost impossible to maintain a constant level of economic activity. Fluctuations are at the heart of market economies; market economies cannot exist without them. These fluctuations can be described as the economic cycle and, like every cycle, a series of events build these phases. The business cycle consists of three phases: expansion (until the peak is reached), a point of decline into recession, and a rebound from recession into recovery. These events need to be closely examined because it is possible for the economy to reach extreme peaks and troughs, which can abruptly change the course of the cycle. For example, if it is neglected and the economy reaches an extremely low level, considered a recession, it would be extremely difficult for the economy to recover from this recession and would have to face serious consequences such as huge debts. Such consequences are the exact reasons why we have a governing body of the nation (the government), whose job it is to monitor the economy in order to produce sustainability and growth. In such situations, the government implements and enforces certain policies that apply to specific situations and circumstances. Such policies help the government influence and control the direction of activity through borrowing, spending, and taxes. These policies are called economic policies, which are also implemented to control the total demand for final goods and services in the economy at a given time and price level (aggregate demand). There are two policies that specifically control aggregate demand and stimulate the economy, fiscal and monetary policy. Fiscal policy is about taxation, “fiscal policy is a change in taxation and middle of paper.... ..the goods market is impacted by fiscal policy and the asset market is linked to monetary policy. The question of which policy is most effective remains unanswered, as different viewpoints will result in different opinions about the effectiveness of a policy and the level of effectiveness it produces. Keynesians, proponents of fiscal policy, and monetarists both disagree due to different assumptions. Ultimately, what remains are the facts: "Monetary policy has become more popular because fiscal policy can have more supply-side side effects on the economy as a whole, monetarists argue that 'an expansionary fiscal policy is likely to cause crowding out and monetary policy is quicker to implement.' than fiscal policy” (Difference between monetary policy and fiscal policy, Economicshelp.org). In general, fiscal policy and monetary policy help stimulate the economy..