An example of an automatic stabilizer is:

Question

Quizplus · Accepted Answer

All of these options are examples of automatic stabilizers. Automatic stabilizers are features of the economy that naturally help to stabilize economic output without any additional government intervention. In option A, as more people become unemployed, they become eligible for unemployment insurance payments, which help to support their income and stabilize overall demand in the economy. In option B, as incomes rise during an economic boom, people generally pay more in taxes, which can help to reduce inflationary pressures in the economy. In option C, as unemployment falls during an economic boom, fewer people need government support for food assistance, which can help to reduce government spending and stabilize the overall budget.

An Example of an Automatic Stabilizer Is