The Deficit Reduction Act (DRA)of 2005 Provided States with the Option

question 69

Multiple Choice

The Deficit Reduction Act (DRA) of 2005 provided states with the option of imposing ________ to certain categories of Medicaid recipients.

• A) cost-sharing charges
• B) premiums
• C) taxes on medical benefits
• D) both a and b

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Definitions:

Induced Consumption

The portion of consumer spending that increases or decreases as disposable income increases or decreases, respectively.

Disposable Income

The collective fiscal pool available to households for spending and saving post income tax engagements.

Induced Consumption

The concept in Keynesian economics referring to the portion of consumer spending that increases with income. Higher income levels tend to lead to higher consumer spending.

Disposable Income

The total financial resources available to people or households for savings and expenses after subtracting income tax.