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:

Physical Capital

Assets that are tangible, such as buildings, machinery, and equipment, used to produce goods and services.

Future Income

Anticipated earnings or revenue one expects to receive in a forthcoming period, driven by employment, investments, or other sources.

Human Capital

The set of skills, acquired knowledge, and lived experiences present in an individual or a populace, evaluated in light of their value significance or cost to a corporation or a sovereign state.

Education

The process of facilitating learning, or the acquisition of knowledge, skills, values, morals, beliefs, and habits through various methods such as teaching, training, and research.