Explain the difference between discretionary and automatic fiscal ...

[leo leo]

Explain the difference between discretionary and automatic fiscal policy. Provide examples of each.
 
  What will be an ideal response?

Question 2

Which of the following statements is true of incentives?
 
  A) Incentives can be financial or moral, but not coercive.
  B) Incentives can be financial or coercive, but not moral.
  C) Incentives are designed to change behavior.
  D) Incentives are always in the form of rewards.

[akemokai]

Answer to Question 1

Discretionary policy is an action that is initiated by an act of Congress such as implementation of a spending program or a change to tax law. Automatic fiscal policy is triggered by the state of economy and happens naturally such as a decrease in tax revenues as a result of a fall in incomes or an increase in unemployment payments due to an increase in the unemployment rate.

Answer to Question 2

C

[leo leo]

Gracias!

[cdmart10]

TYSM