Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN: 9781305506725
Author: James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher: Cengage Learning
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Chapter 11, Problem 8CQ
To determine
The automatic stabilizers and its advantage.
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Which of the following is NOT an automatic stabilizer? a. income taxes b. unemployment insurance c. Medicaid d. food stamps e. monetary policy
How do automatic stabilizers work
How do automatic stabilizers work?
How do automatic stabilizers work
Briefly discuss how time lag could be an argument against policy activism. What is the role of automatic stabilizer in this context? Explain with examples
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Economics: Private and Public Choice (MindTap Course List)
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- Is Medicaid (federal government aid to low-income families and individuals) an automatic stabilizer?arrow_forwardWhy do automatic stabilizers function automatically?arrow_forwardWhich of the following are examples of automatic stabilizers? Check all that apply. Personal income taxes Corporate income taxes The discount ratearrow_forward
- Unemployment insurance and welfare programs work as automatic stabilizers. True Falsearrow_forwardHow relevant is the multiplier concept to the implementation of expansionary and contractionary fiscal policies?arrow_forwardCan you indicate 2 built in stabilizers and show they function during a recession and expansion.arrow_forward
- If government policy makers were worried about the inflationary potential of the economy, which of the following would be a correct fiscal policy change?arrow_forwardWhat are the three fiscal policy tools and how would each be used to counter a contractionary gap?arrow_forwardWhich of the following is NOT an automatic stabilizer? income taxes transfers for welfare payments unemployment insurance benefits government spending on educationarrow_forward
- pick one is (are) an example of an automatic stabilizer. A. A state income tax B.Property taxes C.A minimum hourly wage law D. Unemployment assistance E. Federal student loan programsarrow_forwardWhich of the following is not an automatic stabilizer. Pick a,b,c, or d A) Sales tax B)State retirement pension C) unemployment benefits D)income taxarrow_forwardWhat are the reasons of fiscal policy not being effective in an economy according to classical economists?arrow_forward
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