Answer: Expansionary fiscal policy and contractionary monetary policy.

**Explanation:** - **Option A** is correct because a decrease in taxes signifies an expansionary fiscal policy, which stimulates aggregate output. Simultaneously, an increase in interest rates reflects a contractionary monetary policy, often implemented to counteract inflationary pressures resulting from fiscal expansion. - **Option B** is incorrect because a reduction in taxes is characteristic of expansionary fiscal policy, not contractionary fiscal policy. - **Option C** is incorrect for the same reason as Option B; a tax cut is an expansionary fiscal measure, not a contractionary one. This question tests the understanding of how fiscal and monetary policies interact to influence economic conditions.

Author: LeetQuiz Editorial Team