Automatic stabilizers are changes in fiscal policy that affect _____ without the need for explicit action by policymakers.
A) aggregate demand
B) the LRAS curve
C) short-run aggregate supply
D) aggregate demand and short-run aggregate supply

Question

Quizplus · Accepted Answer

Automatic stabilizers are changes in fiscal policy that are automatically triggered by changes in the business cycle, such as changes in income or unemployment. They affect aggregate demand without explicit action by policymakers. Therefore, the correct answer is A - aggregate demand.

Automatic Stabilizers Are Changes in Fiscal Policy That Affect _____