How can automatic stabilizers slow an economic recovery? a.Automatic stabilizers

Question

How can automatic stabilizers slow an economic recovery?

a.Automatic stabilizers increase interest rates during recoveries without additional government action, which act to slow the recovery.

b.Automatic stabilizers decrease the money supply without additional government action, which act to slow the recovery.

c. Automatic stabilizers reduce taxes and raise expenditures during recoveries without additional government action, which act to slow the recovery.

d. Automatic stabilizers increase taxes and reduce expenditures during recoveries without additional government action, which act to slow the recovery.

Explanation / Answer

b.Automatic stabilizers decrease the money supply without additional government action, which act to slow the recovery.

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