Automatic stabilizers decrease the impact of a recession on the level of economic activity because they Question content area bottom Part 1 A. increase taxes so the budget is always balanced. B. raise the exchange rate so U.S. exports become more attractive to foreigners. C. increase the quantity of money in circulation. D. mean disposable income does not change by as much as real GDP. E. reduce the interest rate and so allow firms to increase their level of investment.

Automatic stabilizers decrease the impact of a recession on the level of economic activity because they Question content area bottom Part 1 A. increase taxes so the budget is always balanced. B. raise the exchange rate so U.S. exports become more attractive to foreigners. C. increase the quantity of money in circulation. D. mean disposable income does not change by as much as real GDP. E. reduce the interest rate and so allow firms to increase their level of investment.

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter20: Exchange Rates And The Macroeconomy

Section: Chapter Questions

Problem 3TY

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