Please answer the following questions:

1) Distinguish between discretionary and nondiscretionary fiscal policy.

2) Differentiate between expansionary and contractionary fiscal policy.

3) Explain expansionary fiscal policy and its effects on the economy and Federal budget.

4) Explain contractionary fiscal policy and its effects on the economy and Federal budget.

5) Which curve (AD or SRAS) will be affected and which direction (leftward or rightward) it will shift when the Congress increases the income tax?

6) Which curve (AD or SRAS) will be affected and which direction (leftward or rightward) it will shift when the Congress goes to war against Canada?