Do automatic fiscal stabilizers eliminate business cycles?
A)Yes
B)No,because they have no effect if the business cycle is the result of some unanticipated change
C)No,but they do moderate business cycles
D)No,they increase the likelihood that a business cycle occurs
E)No,they make business cycle fluctuations more severe

Question

Quizplus · Accepted Answer

Automatic fiscal stabilizers, such as progressive taxation and unemployment benefits, cannot entirely eliminate business cycles, but they do help moderate the severity of economic fluctuations.

Do Automatic Fiscal Stabilizers Eliminate Business Cycles