Taxes and government expenditures that, without need for additional government action, change in response to changes in the level of economic activity are examples of
A) cyclically balanced budgets.
B) built-in monetary stabilizers.
C) discretionary fiscal variables.
D) automatic fiscal policy.

Question

Quizplus · Accepted Answer

Automatic fiscal policy refers to taxes and government expenditures that automatically adjust with changes in economic activity, helping to stabilize the economy without the need for new government action.

Taxes and Government Expenditures That, Without Need for Additional Government