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Explain the difference between a discretionary fiscal policy and an automatic stabilizer fiscal policy?
Explain the difference between a discretionary fiscal policy and an automatic stabilizer fiscal policy. Give an example of each one that government could do.
2 Answers
- OiyLv 71 week ago
A discretionary fiscal policy will have a time lag between policy setting and action. The target is very specific to the area and sector which is in need. Automatic fiscal policy will have no time lag in action. Its aim is to shift the aggregate demand to the potential position. It is difference from the monetary policy because it has no effect on money supply. It focuses on tax or G spending. Good Bye Yahoo, last day.
- Anonymous2 weeks ago
discretionary fiscal policy is like water it finds its own levels, weak or unnecessary (to the public) business fail or succeed according to uses.
automatic stabilizer fiscal policy is the legislature protecting their investments regardless of what the public wants, or needs.
ACTUALLY:
Discretionary fiscal policy means the government make changes to tax rates and or levels of government spending.
Automatic stabilizers are ongoing government policies that automatically adjust tax rates and transfer payments in a manner that is intended to stabilize incomes