Actual federal budgets are not an accurate measure of discretionary fiscal policy because
A)it is difficult to measure government spending accurately
B)people cheat on their income taxes
C)even without changes in fiscal policy,budget deficits increase during expansions
D)even without changes in fiscal policy,budget deficits increase during recessions
E)earlier administrations may have contributed to current budget deficits

Question

Quizplus · Accepted Answer

Even without changes in fiscal policy, budget deficits tend to increase during times of recession as government revenue falls due to lower economic activity and higher spending on social welfare programs such as unemployment insurance. Therefore, simply looking at the federal budget without taking into account the state of the economy and other factors can be misleading when assessing discretionary fiscal policy.

Actual Federal Budgets Are Not an Accurate Measure of Discretionary