ECONOMICS
AGGREGATE DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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reduce private debt
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go into effect w/o passage of new legislation
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they require a balanced budget
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keep unemployment at zero percent
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Detailed explanation-1: -One of the benefits of automatic stabilizers is that they do not require legislative action and respond quickly to economic downturns.
Detailed explanation-2: -Which of the following is an advantage of automatic stabilizers? a. Because they affect disposable personal income directly, automatic stabilizers act swiftly to reduce the degree of changes in real GDP.
Detailed explanation-3: -What Is an Automatic Stabilizer? Automatic stabilizers are a type of fiscal policy designed to offset fluctuations in a nation’s economic activity through their normal operation without additional, timely authorization by the government or policymakers.
Detailed explanation-4: -On average, automatic stabilisers absorb around 60% of a specific negative shock to market income across countries (see Figure 1).