This Question: 1 pt 2 of 15 (15 complete) | This Quiz: 15 pts possible Briefly e

Question

This Question: 1 pt 2 of 15 (15 complete) | This Quiz: 15 pts possible Briefly explain whether each of the following is an example of (1) a discretionary fiscal policy, (2) an automatic stabilizer, or (3) not a fiscal policy The federal government increases spending on rebuilding the New Jersey shore following a hurricane This is an example of O A. an automatic stabilizer. B. a discretionary fiscal policy 0 C, not a fiscal policy The Federal Reserve sells Treasury securities. This is an example of A. not a fiscal policy. O B. an automatic stabilizer. ° C, a discretionary fiscal policy. The total the federal government pays out for unemployment insurance decreases during an expansion This is an example of O A. a discretionary fiscal policy. B. an automatic stabilizer. O C. not a fiscal policy. The revenue the federal government collects from the individual income tax declines during a recession

Explanation / Answer

1). A). Discretionary Fiscal Policy

This is because there in this case, the government's intention is to increase it's expenditure in order to meet the long time demands of the people of New Jersey who have been affected by Hurricane.

2). A)Not a fiscal policy.

This is because Federal Reserve selling Treasury comes under monetary policy.

3). B). Automatic stabilizer

This is because the actions taken by the federal government are to meet the immediate effects in the market

4). C). Automatic Stabilizer

This is because there is no intention by the Government to get its revenue reduced. The revenue reduces automatically due to change in market conditions

5). A).Not a fiscal policy.

This is because changing mileage required by gasoline cars is in no way related to economic welfare and development

6). A discretionary POLICY

This is because a legislative action is taken place by the Congress in this case

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