Income transfers,such as unemployment insurance,welfare benefits,and food stamps,

Question

Quizplus · Accepted Answer

Income transfers, such as unemployment insurance, welfare benefits, and food stamps, help stabilize aggregate demand. This is because they provide essential support to households during an economic downturn, which boosts their purchasing power and helps to maintain overall consumer spending. As a result, income transfers can play a critical role in preventing or mitigating recessions, making them a valuable tool in macroeconomic policy.

Income Transfers,such as Unemployment Insurance,welfare Benefits,and Food Stamps