During a recession, increases in unemployment insurance, welfare, and Medicaid payments are called:
A) social security.
B) transfer payments.
C) automatic stabilizers.
D) charity.
E) both "transfer payments" and "automatic stabilizers."

Question

Quizplus · Accepted Answer

During a recession, increases in unemployment insurance, welfare, and Medicaid payments are considered both transfer payments (since they transfer income from one group to another) and automatic stabilizers (because they automatically increase when the economy is in a downturn, helping to stabilize income and consumption without the need for new legislation).

During a Recession, Increases in Unemployment Insurance, Welfare, and Medicaid