Programs that automatically increase government spending (relative to revenue) during a recession and automatically decrease government spending (relative to revenue) during an economic boom are called:
A. discretionary fiscal policy.
B. supply-side programs.
C. automatic stabilizers.
D. tax credits.
Answer: C
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The multiplier effect makes the aggregate demand curve:
A. steeper. B. horizontal. C. vertical. D. flatter.
Which of the following macroeconomic variables is the most seasonally procyclical?
A. Expenditure on services B. The real wage C. The unemployment rate D. Expenditure on durable goods
Unilateral transfers are
A) transactions that take place across national boundaries but in which both transactions are citizens of the same country. B) government transactions that use gold and other official reserves. C) gifts from a resident of one country to a resident in a foreign country. D) the payments of interest to residents of another country.
Under the target price system,
A) supply is restricted. B) consumers must pay the target price. C) payments are made to the government when the price paid by consumers rises above the target price. D) farmers are paid a deficiency payment if the market price for their goods is below the target price. E) a and c