Answer Happy

The economy is in a bad recession and the gap from potential GDP is large. Describe the discretionary and automatic fiscal policy actions that might occur. Discretionary fiscal policy that might occur is Automatic fiscal policy that might occur is a decrease in government expenditure and an increase in taxes by a decision of Congress; a decrease in transfer payments and an increase in taxes with no interference by Congress O a decrease in transfer payments and an increase in taxes with no interference by Congress; a decrease in government expenditure and an increase in taxes by a decision of Congress an increase in transfer payments and a fall in taxes with no interference by Congress; an increase in government expenditure and a cut in taxes by a decision of the President an increase in government expenditure and a cut in taxes by a decision of Congress; an increase in transfer payments and a fall in taxes.