Which of the Following Is an Example of Discretionary Fiscal

question 163

Multiple Choice

Which of the following is an example of discretionary fiscal policy?

• A)an increase in unemployment insurance payments during a recession
• B)an increase in income tax receipts with rising income during an expansion
• C)the tax cuts passed by Congress in 2001 to combat the recession
• D)a decrease in food stamps issued during an expansion or boom

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Definitions:

Managers

Individuals responsible for directing and overseeing the operations and activities of a company or organization, making strategic decisions to ensure goals are met.

Marginal Benefit

The increased pleasure or usefulness obtained from the consumption of one more unit of a good or service.

Marginal Benefit

Enhanced satisfaction or usefulness gained upon consuming an additional unit of a good or service.