Automatic stabilizers are

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Automatic stabilizers are components of the federal budget that counter the effects of the business cycle without explicit intervention by the president or Congress. They work by automatically increasing government spending and reducing tax revenue during a recession, which stimulates the economy and helps to stabilize it. They also work by automatically decreasing government spending and increasing tax revenue during an expansion, which helps to prevent the economy from overheating. Examples of automatic stabilizers include unemployment insurance, welfare benefits, and progressive income taxes.

Automatic Stabilizers Are