Active changes in tax and spending by government intended to smooth out the business cycle are called ________, and changes in taxes and spending that occur passively over the business cycle are called ________.
A)automatic stabilisers; discretionary fiscal policy
B)discretionary fiscal policy; automatic stabilisers
C)automatic stabilisers; monetary policy
D)discretionary fiscal policy; conscious fiscal policy

Question

Quizplus · Accepted Answer

Discretionary fiscal policy refers to intentional changes in government spending and taxes, while automatic stabilizers are changes in spending and taxes that happen naturally during the business cycle.

Active Changes in Tax and Spending by Government Intended to Smooth