6. Automatic, or built-in, stabilizers Which of the following are examples of au

Question

6. Automatic, or built-in, stabilizers Which of the following are examples of automatic stabilizers? Check all that apply. As corporate profits rise during an economic expansion, corporate income tax revenues rise. ? In response to the 2008 recession, Congress approved billions of dollars of additional spending on public infrastructure projects As unemployment falls during an expansion, unemployment insurance payments decline. As people earn higher incomes during an expansion, the progressive tax system requires them to pay higher average tax rates.

Explanation / Answer

ANSWER : Examples of automatic stabilizers are :

* As corporate profits rise during an economic expansion ,corporate income tax revenue rise .

* As unemployment falls during an expansion , unemployment insurance payments decline.

* As people earn higher income during an expansion , the progressive tax system require them to pay higher average tax rate .

Automatic stabilizers are economic policies/ programs designed to offset fluctuations of a country's economic activity without intervention by the government or policymakers . The best-known automatic stabilizers are corporate and personal taxes, and transfer systems such as unemployment insurance and welfare.

Related Questions

Navigate

• Browse (All)
• Browse 6
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.