Respuesta :
Answer: a) -A tax cut
-Additional spending on national park facilities
b) Expansionary fiscal policy
Explanation:
Fiscal Policy refers to how the government of a country is using it's spending and taxes to influence Economic conditions on a Macro level.
The keywords for this question are TAXES and SPENDING.
The means that a Discretionary FISCAL policy includes Taxes and Spending.
Now the way to close the Recessionary gap that is opening is to put more money into the Economy. The Government can do this by REDUCING TAXES which will means people have more money to spend and ADDITIONAL SPENDING on NATIONAL PARK FACILITIES as this means that the government is pumping more money into the Economy.
The discretionary fiscal policy needed to bring the economy closer to potential output is an example of an EXPANSIONARY FISCAL POLICY.
This is where the Government aims to put more money into the economy so that growth can be acheived and they do this by lowering taxes and increasing spending either singularly or simultaneously.
The Fiscal policy which can bring the economy closer to potential output is the Option C A tax cut.
The Fiscal Policy
It is a policy which is used by Federal Government to manage financial spending and Tax Rates to Control Macro-economy. In the first part of the Question, to bring the economy closer to potential output the Fiscal policy Tax Cut is needed.
In the second part of Question, the discretionary fiscal policy needed to bring the economy closer to potential output an example of expansionary fiscal policy.
Under this policy Government tries to add money into the market through the help of Tax cut and increased spending.
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