Question

Vulcan Materials stock price soared in the days following the election of President Trump. Vulcan's products, such as asphalt and concrete, are used in construction and President Trump had pledged to bring about increased spending on infrastructure projects that would require such products. Spending on infrastructure projects is an example of ________ aimed at increasing real GDP and employment.

Answer 1

Answer:

Spending on infrastructure projects is an example of Discretionary Fiscal Policy aimed at increasing real GDP and employment.

Explanation:

• A discretionary fiscal policy basically refers to the manipulation or adjustment of various fiscal instruments by the government such as public taxes and government spending.
• The aim of discretionary fiscal policy is to adjust the overall macroeconomic condition in any country based on the existing or current situation or scenario.
• Now,infrastructural spending is part of fiscal policy or instrument to adjust the macroeconomic condition of the country as reflected by necessary modification in the GDP and employment level.Hence, higher infrastructural spending by the government would expectedly increase the residential and commercial construction projects in the country thereby,enhancing the GDP and the employment level in the country and boost the overall economy.