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1) Distinguish between discretionary and nondiscretionary fiscal policy

Economics

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1) Distinguish between discretionary and nondiscretionary fiscal policy.

2) Differentiate between expansionary and contractionary fiscal policy.

3) Plot the following markets on a graph:

Government market: using 50 jets for Q and $5 billion for P as point A (equilibrium).

AD/AS graph: using 19.1 trillion for RGDP and 1.9% for inflation as point A (equilibrium).

• How will our AD/AS graph look like when U.S. government buys less jets in the government market?

4) Plot the following markets on a graph:

Labor market: using 5 laborers and $5.00 for wage as point A (equilibrium).

AD/AS graph: using 19.1 trillion for RGDP and 1.9% for inflation as point A (equilibrium).

• How will our AD/AS graph look like when Congress implements an income tax hike in the labor market?