Deficit targeting acts as ________ because it requires taxes to be raised and government spending to be cut during ________.
A) an automatic stabilizer; an expansion
B) an automatic destabilizer; an expansion
C) an automatic stabilizer; a contraction
D) an automatic destabilizer; a contraction

Question

Quizplus · Accepted Answer

Deficit targeting acts as an automatic destabilizer because it requires taxes to be raised and government spending to be cut during a contraction, which can exacerbate economic downturns.

Deficit Targeting Acts as ________ Because It Requires Taxes to Be