Which of the Following Best Illustrates the Use of Discretionary

question 28

Multiple Choice

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

• A)Congress provides $1 billion in relief aid for hurricane victims.
• B)Congress appropriates $500 million to help the needy,and the appropriation is financed by a tax on wealth.
• C)Income tax receipts are smaller because of a decline in real GDP during a recession.
• D)The Federal Reserve tightens credit when it receives news of accelerating inflation.
• E)Congress passes a bill authorizing $2 billion in additional spending when it receives news of a deepening recession.

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Definitions:

Critical Thinking

The objective analysis and evaluation of an issue in order to form a judgment.

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Recollections of past events that occurred during one's childhood, which can significantly influence one's personality, behaviors, and perceptions in adulthood.

Tolerate Uncertainty

The ability to remain calm and functional despite not knowing the outcome of a situation or having incomplete information.

Modern Psychologists

Professionals in the field of psychology who apply contemporary theories and research to understand, predict, and treat mental, emotional, and behavioral issues.