needs-tested spending is fiscal policy because it
a. automatic; increases when the government's budget deficit falls
b. discretionary; increases when tax revenue increases
c. automatic; increases in recession and decreases in expansion
d. discretionary; is determined by economic hardship

The correct answer is C

Explanation:

Needs testing spendings is the  expenditures or expense of government which require or pass a needs test like the unemployment. So, during the time of recession, unemployment pays outs are high but these pay out stimulate the economy and vice versa  or opposite of recession is in the expansion.

So, it is automatic policy as it increase during the time of recession and decrease or reduce in expansion.

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