Programs That Automatically Increase Government Spending (Relative to Revenue) During

question 54

Multiple Choice

Programs that automatically increase government spending (relative to revenue) during a recession and automatically decrease government spending (relative to revenue) during an economic boom are called:

• A) discretionary fiscal policy.
• B) supply-side programs.
• C) automatic stabilizers.
• D) tax credits.

---

Definitions:

Budgeted Cost

An estimated amount set aside for expenditures in the budgeting process, serving as a financial guideline for spending.

Raw Material Purchases

The acquisition of basic materials that are either consumed in the production process or included as part of the finished goods.

Expected Cash Collections

The projected amount of money a company anticipates receiving from customers over a specific period, based on sales and credit terms.

Budgeted Sales

The projected amount of sales revenue a company expects to achieve during a specific period, often part of financial planning.