Economic policy refers to the actions and strategies implemented by a government to manage its economy. This includes decisions on taxation, government spending, and regulation of markets. The goal is to promote economic growth, stability, and the overall well-being of its citizens. Governments use various tools to influence economic activity, such as monetary policy, which involves controlling the money supply and interest rates, and fiscal policy, which focuses on government spending and taxation. These policies aim to address issues like inflation, unemployment, and economic inequality, ensuring a balanced and healthy economy.