Due to Automatic Stabilizers, When Income Decreases, Government Transfer Spending

question 1

Multiple Choice

Due to automatic stabilizers, when income decreases, government transfer spending:

• A)increases and tax revenues decrease.
• B)decreases and tax revenues increase.
• C)and tax revenues decrease.
• D)and tax revenues increase.

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Definitions:

Sales Receipts

Documents that provide proof of a transaction between a seller and a buyer, indicating the exchange of goods or services for payment.

Bank Statements

Financial statements issued by a bank detailing the transactions in a depositor's account over a certain period.

Chart of Accounts

A listing of all the accounts in a business's general ledger, which includes assets, liabilities, revenue, expenses, and equity.

Identification Numbers

Unique numerical codes assigned to entities for identification purposes, such as Social Security numbers for individuals or EINs for businesses in the U.S.