Structures in the Economy Increase Aggregate Demand When the Economy

question 12

Multiple Choice

Structures in the economy increase aggregate demand when the economy is in recession and decrease aggregate demand when the economy is inflationary are known as:

• A) tax transfers.
• B) inventory investment.
• C) accelerators.
• D) depreciation.
• E) automatic stabilizers.

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Definitions:

Capacity Utilization Rate

The percentage of a firm's total production capacity that is actually being used in production.

Proprietorship

A business owned and operated by a single individual, where there is no legal distinction between the owner and the business entity.

Issuing Stock

The process by which a company distributes shares to investors in order to raise capital for business expansion or other financial needs.

Investment Projects

Initiatives undertaken by individuals, firms, or governments involving the allocation of resources with the expectation of future returns.