Features of the U.S.federal government expenditure and taxation programs that tend to automatically slow the economy during times of high economic activity and boost the economy during periods of recession are called:
A)discretionary expenditures.
B)automatic stabilizers.
C)non-automatic stabilizers.
D)none of the above.

Question

Quizplus · Accepted Answer

Automatic stabilizers are features of the U.S. federal government expenditure and taxation programs that tend to automatically slow the economy during times of high economic activity by increasing taxes and reducing government spending, and boost the economy during periods of recession by decreasing taxes and increasing government spending. Discretionary expenditures, on the other hand, refer to spending that is decided upon by Congress each year and can be adjusted based on different circumstances. Non-automatic stabilizers do not exist as a defined term in this context.