If the economy falls into a recession, which of the following responses constitutes the use of automatic fiscal policy?
A) an existing system to make government payments to the growing ranks of unemployed workers
B) an income tax cut voted on by Congress and quickly signed by the President
C) a new program to fund local governmentsʹ hiring of 100,000 street sweepers within a year
D) All of the above answers are correct.

Question

Quizplus · Accepted Answer

Automatic fiscal policy refers to existing programs and policies that automatically respond to changes in the economy, such as unemployment insurance payments to support those who lose their jobs during a recession. Choices B and C are examples of discretionary fiscal policy, as they require active decision-making and intervention by Congress and the President.

If the Economy Falls into a Recession, Which of the Following