Which of the Following Is an Example of an Automatic

question 110

Multiple Choice

Which of the following is an example of an automatic fiscal policy action?

• A)an increase in spending on defense goods resulting from increased world tensions
• B)an increase in the tax rate resulting from a desire to shrink the budget deficit
• C)a decrease in the tax rate resulting from an effort to increase aggregate demand to combat a recession
• D)increased unemployment benefit payments resulting from higher unemployment
• E)None of the above answers are correct.

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Definitions:

Receiving Cash

The process involving the collection or receipt of cash in a business transaction.

Not Satisfied

A term indicating that expectations, requirements, or conditions have not been met to an adequate degree.

Selling Price

The price at which a product or service is offered for sale to consumers.

Defective Merchandise

Goods that are flawed or fail to meet quality standards or specifications, often leading to returns or exchanges.