ECON-1012-B-Introduction to Macroeconomics Course Materials & Test Answers | moodle.uleth.ca

The economy has a large recessionary gap. Of the following fiscal policy changes that might occur, which is discretionary and which is automatic?

A discretionary stimulus is ________ and an automatic stimulus is ________.

the government's decision to cut taxes; falling tax revenues

the government's decision to cut its outlays; the government's decision to increase transfer payments

increasing transfer payments with no government action; a government's decision to cut taxes

the government cuts the real interest rate; an increase in investment

rising transfer payments with no action of the government; a cut in government expenditure

View this question

Crowdly