Which of the Following Is an Example of Built-In Stability

question 7

Multiple Choice

Which of the following is an example of built-in stability? As real GDP decreases, income tax revenues

• A) increase and transfer payments decrease.
• B) decrease and transfer payments increase.
• C) and transfer payments both decrease.
• D) and transfer payments both increase.

---

Definitions:

Public Policy

Principles and standards considered to be in the public interest, which guide lawmakers and regulators.

Negligence Liability

Legal responsibility that arises from failing to act with the level of care that someone of ordinary prudence would have exercised under the same circumstances.

Regulatory

Pertaining to rules or directives made and maintained by an authority to regulate activities, often within specific industries.

Character and Skill

Attributes that define an individual’s moral qualities and abilities in performing tasks or professions.