For various reasons, fiscal policy changes automatically when output and employment fluctuate:

Do some online research about our last recession in 2007-2009 (or choose any other recession since the Great Depression) and answer the questions below.

Address the following topics in your analysis in your own words:

A. How did the federal government (President and Congress) respond to the recession? B. What types of fiscal policy did they use (explain in detail)? C. Explain why tax revenue changes when the economy goes into a recession. D. Explain why government spending changes when the economy goes into a recession. E. If the government were to operate under a strict balanced-budget rule, what would it have to do in a recession? Would that make the recession more or less severe? F. How do political party politics impact stabilizing fiscal policy?