During a Recession, Rising Transfer Payments and Falling Tax Collections

question 50

Multiple Choice

During a recession, rising transfer payments and falling tax collections
I. help cushion households from the impact of the recession.
II. buffers the fall in real GDP (relative to a situation where transfer payments do not rise and
Tax revenues do not fall) .
III. tend to increase a budget deficit or reduce a budget surplus.

• A) I only
• B) I and II only
• C) II and III only
• D) I, II, and III

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Definitions:

Locus of Control

Refers to an individual's belief about the extent to which their actions influence the outcomes in their lives.

Type B Personality

A temperament distinguished by its serene, forbearing, and unhurried demeanor.

Mindfulness Meditation

A practice of focusing one's mind on the present moment, often used as a technique to manage stress and enhance well-being.

Nonjudgmental

Pertains to an attitude or approach that is open-minded and free from rendering judgments, especially prematurely or without understanding.