When Automatic Fiscal Stabilizers Are in Place,a Shock That Causes

question 8

Multiple Choice

When automatic fiscal stabilizers are in place,a shock that causes a fall in the level of economic activity automatically

• A)results in a decline in the federal budget deficit that lessens the fall in income.
• B)results in a rise in the federal deficit that lessens the fall in income.
• C)requires the federal government to balance the budget.
• D)will lead to a permanent increase in the budget deficit.
• E)both a and b

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