An example of an automatic stabilizer is:
A. governments purchases rising when GDP rises.
B. tax receipts rising when GDP rises.
C. government transfers rising when GDP rises.
D. a discretionary increase in taxes.
Answer: B. tax receipts rising when GDP rises.
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If you buy an insurance policy with a low deductible and no co-payments, you would end up paying
a. A higher premium b. A lower premium c. The premium of a low risk individual d. Both B&C
Who is credited for the original development of the model of aggregate demand and aggregate supply?
Which of the following is true about M1 and M2?
A. M1 includes currency, but M2 does not. B. Neither M1 nor M2 includes money market mutual funds. C. M2 includes saving deposits and money market mutual funds, but M1 does not. D. M1 and M2 both include checking accounts and savings accounts.
Which of the following is true of individual income taxes?
A) Individual income taxes are only collected by the federal government. B) Individual income taxes are only collected by the state governments. C) All states in the U.S. collect individual income taxes. D) The rate of income tax imposed by states in the U.S. varies.