The Canadian Tax and Transfer System Acts as an Automatic

question 86

Multiple Choice

The Canadian tax and transfer system acts as an automatic stabilizer because

• A)net tax revenues decrease during economic booms and decrease during economic recessions.
• B)net tax revenues increase during economic booms and decrease during economic recessions.
• C)tax rates will automatically decrease to stimulate the economy during economic booms.
• D)tax rates will automatically increase if the government is running deficits.
• E)tax rates will automatically increase to stimulate the economy during economic recessions.

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