Transfer Payments Made by Governments Over the Business Cycle in the United

question 12

Multiple Choice

Transfer payments made by governments over the business cycle in the United States

• A) move procyclically with GDP because they are constructed to increase or decrease automatically as tax receipts climb or fall with GDP.
• B) move countercyclically with GDP because they are constructed to increase or decrease automatically as changes in GDP cause corresponding changes in the number of people eligible for payment.
• C) are not well correlated with changes in GDP in part because the discretionary power to enact changes in fiscal policy is diluted across too many congressional committees.
• D) vary directly with tax revenues and therefore play no role in stabilization policy.
• E) none of the above.

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Definitions:

Substance Abuse

The misuse of drugs or alcohol that leads to clinical impairment or distress.

DiClemente and Prochaska Model

A model describing a five-stage process of change for individuals overcoming addictive behaviors and other negative habits.

Precontemplation

A stage in the behavior change process where the individual is not yet considering change or is unaware of the need for change.

Maintenance

In a psychological or therapeutic context, maintenance refers to the ongoing process of sustaining progress made during treatment and preventing relapse into previous unhealthy behaviors.