The economic impact of automatic stabilizers during inflationary periods is to
A) accelerate inflationary pressures.
B) increase exports.
C) have no impact on inflation.
D) moderate inflationary pressures.

Question

Quizplus · Accepted Answer

Automatic stabilizers, such as progressive taxation and unemployment benefits, help to stabilize the economy during inflationary periods by increasing government spending and boosting demand, which can help to mitigate inflationary pressures. Therefore, the economic impact of automatic stabilizers during inflationary periods is to moderate inflationary pressures.

The Economic Impact of Automatic Stabilizers During Inflationary Periods Is