Fiscal policies that require no government action but that are expansionary when the economy contracts and contractionary when the economy expands are known as:
A)discretionary fiscal policy.
B)automatic stabilizers.
C)autonomous spending policies.
D)destabilizing fiscal policies.

Question

Quizplus · Accepted Answer

Automatic stabilizers are government policies that stabilize the economy without requiring any special actions from policymakers. They automatically respond to changes in economic conditions, such as changes in income, and provide an automatic stimulus or contraction to the economy. This is different from discretionary fiscal policy, which involves deliberate actions taken by the government in response to economic conditions.

Fiscal Policies That Require No Government Action but That Are