An Example of an Automatic Stabilizer Is

question 61

Multiple Choice

An example of an automatic stabilizer is:

• A) changing the tax laws to increase the marginal tax rates.
• B) the interest the government pays on loans.
• C) the food stamp program.
• D) the indexation of social security benefits to the consumer price index.

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Definitions:

Temporary

Pertaining to an employee, position, or status that is intended for a limited time period, often with an end date in mind.

Permanent

Describes assets or records that are intended to be held or used on a long-term basis and not expected to be sold or otherwise converted into cash within a year.

General Journal

A journal used to record all types of accounting transactions with detailed explanations.