Unformatted text preview: Automatic Expansionary 6) The government eliminates the deductibility of interest expense of tax purposes. Discretionary Contractionary 7) The government launches a major new space program to explore Mars. Discretionary Expansionary 8) The government raises Social Security taxes. Discretionary Contractionary 9) Corporate profits increase; as a result, government collects more corporate income taxes. Automatic Contractionary 10) The government raises corporate income tax rates. Discretionary Contractionary 11) The government gives all its employees a large pay raise. Discretionary Expansionary...
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- Spring '06
- Fiscal Policy, Personal income tax, corporate income, Discretionary Contractionary