Author Question: During a boom expansionary economy, public assistance payments and unemployment compensation ... (Read 51 times)

dalyningkenk · **on:** Jun 30, 2018

During a boom expansionary economy, public assistance payments and unemployment compensation payments automatically decrease while income taxes automatically increase. Which of the following best describes the effect of these changes on aggregate demand?
a. Aggregate demand will be less than it would be without these automatic stabilizers.
b. Aggregate demand will be the same as it was before the expansion.
c. Aggregate demand will be less than it was before the expansion.
d. none of the above

Question 2

The main advantage of the Eurocurrency market is that investment funds cannot be subject to foreign government controls.
a. True
b. False
Indicate whether the statement is true or false