An Example of an Automatic Stabilizer Is

question 103

Multiple Choice

An example of an automatic stabilizer is

• A) personal income taxes.
• B) inheritance taxes.
• C) veterans' benefits.
• D) corporate dividends.

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Definitions:

Transfer Payments

Payments made by governments to individuals without the expectation of any goods or services in return, such as welfare or social security payments.

Income Tax Rates

The percentage of one's income that is paid to the government as tax, which can vary based on income level and other factors.

Income

Income is the amount of money or its equivalent received during a period of time in exchange for labor, services, or investments.

Real Disposable Income

The income of individuals or the economy after adjusting for inflation, available for spending and saving after income taxes have been accounted for.