Which of the Following Best Illustrates the Use of Discretionary

question 78

Multiple Choice

Which of the following best illustrates the use of discretionary fiscal policy?

• A)Congress providing $1 billion in relief aid for hurricane victims
• B)Congress appropriating $400 million to help the needy and the appropriation being financed by a tax on wealth
• C)Income tax receipts being smaller because of a decline in real GDP during a recession
• D)The Federal Reserve tightening credit when it receives news of accelerating inflation
• E)Congress passing a bill authorizing $2 billion in additional spending when it receives news of a deepening recession

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Definitions:

Reference Groups

Social groups that individuals compare themselves to for guidance in developing their own attitudes, beliefs, and behaviors.

Consumer Decision

The process by which a consumer selects a product or service among multiple choices, influenced by factors like personal preferences, price, quality, and marketing.

Purchase Affected

Instances where the decision to buy a product or service is influenced by external or internal factors.

Incumbent Politicians

Refers to officials who currently hold a position or office in a governmental body.