Discretionary fiscal policy entailsA) automatic changes in spending or taxes that occur as economic conditions change.B) changing government spending or tax policy to offset automatic stabilizers.C) legislative changes in spending or tax policies.D) actions exercised by the President alone in the United States.E) wide swings in income and employment when the government expenditure multiplier is small.

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arafa mahmudee · Accepted Answer

Final Answer : C, Explanation :  Discretionary fiscal policy refers to deliberate changes in government spending or tax policies as deemed necessary by the legislative body. A is incorrect as it refers to automatic stabilizers, B is partially correct as it refers to offsetting automatic stabilizers, but does not fully capture discretionary fiscal policy. D is incorrect as such actions require approval from Congress. E is incorrect as it refers to the Keynesian notion of the government expenditure multiplier, which is not directly related to discretionary fiscal policy.

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