The economy is in a recession and the recessionary gap is large. Discretionary fiscal policy that might occur is ________. Automatic fiscal policy that might occur is ________.
A) a decrease in transfer payments and an increase in taxes with no interference by Parliament; a decrease in government expenditure and an increase in taxes by a decision of Parliament
B) an increase in transfer payments and a fall in taxes with no interference by Parliament; an increase in government expenditure and a cut in taxes by a decision of Parliament
C) an increase in government expenditure and a cut in taxes by a decision of Parliament; an increase in transfer payments and a fall in taxes
D) a decrease in government expenditure and an increase in taxes by a decision of Parliament; a decrease in transfer payments and an increase in taxes with no interference by Parliament
E) a decrease in the interest rate; an increase in the quantity of money
Correct Answer:
Verified
Q76: Which of the following is an example
Q88: If real GDP is less than potential
Q89: The economy is in a recession, the
Q90: The economy is in a recession and
Q91: If the budget deficit is $50 billion
Q92: Which of the following policies shifts the
Q93: Choose the correct statement.
A)Contractionary fiscal policy can
Q94: In 2013, Canada had
A)a structural deficit and
Q96: Discretionary fiscal policy is risky because it
Q97: The effect of a change in taxes
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents