ECONOMICS
FISCAL POLICY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Uncontrollable fiscal spending.
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Automatic fiscal spending
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Discretionary fiscal spending.
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Automatic stabilizers.
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Detailed explanation-1: -Discretionary spending is money formally approved by Congress and the President during the appropriations process each year. Generally, Congress allocates over half of the discretionary budget towards national defense and the rest to fund the administration of other agencies and programs.
Detailed explanation-2: -"Discretionary” means that the money will have to be approved by Congress as part of the annual appropriations process, while “mandatory” means the spending is automatic.
Detailed explanation-3: -Discretionary spending typically accounts for around a third of all funding. Interest on the debt, which usually uses less than 10 percent of all funding. Funding for Social Security, Medicare, veterans benefits, and other spending required by law.
Detailed explanation-4: -The main areas of federal spending are national defense, Social Security, healthcare, and interest payments.