An Automatic Stabilizer Is a Feature of the Economy That

question 149

Multiple Choice

An automatic stabilizer is a feature of the economy that

• A)makes prices "sticky."
• B)reduces its sensitivity to shocks.
• C)maximizes its volatility.
• D)automatically reduces recessionary trends.

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Definitions:

Shares

Units of ownership interest in a corporation or financial asset that represent an equal proportion in the distributing of any profits, if any are declared, in the form of dividends.

Capital Gain

Capital Gain is the profit earned from the sale of an asset or investment when the selling price exceeds the purchase price.

Dividends

Payments made by a corporation to its shareholder members, reflecting the earnings of the company distributed among its shareholders.

Dividend Yield

This ratio in finance shows the comparison between a company's annual dividend payout and its stock price.