Automatic stabilizers include
A)Open market operations.
B)Unemployment benefits.
C)Deregulation.
D)Discretionary tax cuts.

Question

Quizplus · Accepted Answer

Automatic stabilizers are government programs that automatically counteract economic downturns without any government action needed. Unemployment benefits are an example of automatic stabilizers as they increase the income of individuals during a recession, and therefore help boost aggregate demand in the economy. Open market operations, discretionary tax cuts, and deregulation are not automatic stabilizers.

Automatic Stabilizers Include