Which of the following is an automatic stabilizer?
A)military spending
B)unemployment compensation payments
C)disability payments to war veterans
D)Medicare payments

Question

Quizplus · Accepted Answer

Unemployment compensation payments are automatic stabilizers because they automatically increase during a recession as more individuals become unemployed, which in turn boosts consumer spending and helps to stabilize the overall economy. The other options (A, C, D) are not automatic stabilizers because they do not automatically increase during a recession and may even be subject to political decisions and budget cuts.

Which of the Following Is an Automatic Stabilizer