The Direction of Discretionary Fiscal Policy Cannot Be Examined by a Simple

Multiple Choice

The direction of discretionary fiscal policy cannot be examined by a simple look at the changes in the actual budget deficits or surpluses.This is because:

A) those changes may reflect the changes in the general price level.
B) those changes may reflect automatic changes in the tax revenues as a result of change in GDP.
C) those changes may reflect the changes in the tax revenues as a result of change in imports.
D) it is impossible to calculate the changes in the actual budget deficits or surpluses.