Author Question: An automatic stabilizer: a. increases inflationary pressure during expansions. b. Increases the ... (Read 43 times)

roselinechinyere27m · **on:** Jun 30, 2018

An automatic stabilizer:
a. increases inflationary pressure during expansions.
b. Increases the drop in disposable income during recessions and increases the jump in disposable income during expansions.
c. reduces the drop in disposable income during recessions and reduces the jump in disposable income during expansions.
d. increases tax revenue relative to government spending throughout the business cycle.
e. decreases tax revenue relative to government spending throughout the business cycle.

Question 2

Which of the following is an example of an injection into the circular flow of income and expenditure?
a. Net taxes
b. Saving
c. Transfer payments
d. Government borrowing
e. Disposable income