Which of the Following Is an Example of an Automatic

question 79

Multiple Choice

Which of the following is an example of an automatic stabilizer?

• A) Congress legislates lower tax rates to increase consumption and investment.
• B) Tax rates are increased during a recession to maintain a balanced budget.
• C) A regressive income tax system reduces tax revenues (as a share of income) as income expands.
• D) Revenues from the corporate income tax increase sharply during a business boom but decline substantially during a recession, even though no new tax legislation has been enacted.

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Definitions:

Cerebral Cortex

The outer layer of the cerebrum in the brain, involved in many complex brain functions including memory, attention, perception, cognition, awareness, thought, language, and consciousness.

Estrus

In mammals, the period in the cycle when the female is sexually receptive (in heat).

Hypothalamus

A region of the brain below the thalamus that coordinates both the autonomic nervous system and the activity of the pituitary, controlling body temperature, hunger, thirst, fatigue, sleep, and circadian cycles.

Self-Esteem Index

A measure used to assess an individual's overall valuation of their worth or value as a person.