Which of the following is a possible effect of automatic stabilizers on the federal budget?
A)A decrease in the deficit during recessions.
B)An increase in the deficit when there is AD excess.
C)An increase in the structural deficit during recessions.
D)A decrease in the deficit during an expansion.

Question

Quizplus · Accepted Answer

Automatic stabilizers, like progressive taxes and unemployment benefits, decrease the deficit during expansions by increasing tax revenues and reducing government spending on benefits.

Which of the Following Is a Possible Effect of Automatic