As a result of the increased deficit associated with discretionary fiscal policy,_____.

A) both the interest rate and real output fall
B) both the interest rate and nominal output rise
C) the interest rate falls and real output rises
D) the interest rate rises and real output falls
E) nominal output rises,real output falls,and the interest rate rises

Discretionary Fiscal Policy

It involves government policy changes in taxation and spending designed to influence economic activity, typically to counteract inflation or deflation and stabilize the economy.

Nominal Output

The total value of goods and services produced by an economy, measured in current prices without adjusting for inflation.

Interest Rate

The cost of borrowing money, typically expressed as a percentage of the amount borrowed.