Which of the Following Is an Automatic Stabilizer That Reduces

question 124

Multiple Choice

Which of the following is an automatic stabilizer that reduces tax receipts during a recession?

• A)Welfare benefits.
• B)Medicaid.
• C)Corporate and individual income taxes.
• D)Indexed retirement and Social Security benefits.

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Definitions:

Output Units

Quantitative measures representing the amount of goods or services produced by a company or an economic system.

Constant Returns to Scale

A situation where increasing all inputs by the same proportion results in output increasing by that same proportion, indicating linear scalability of production processes.

Economies of Scale

Refers to the cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale.