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Give Two Examples of Automatic Stabilizers,and Explain Why They Are

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Essay

Give two examples of automatic stabilizers,and explain why they are an important component of fiscal policy.


Definitions:

Transitivity

The concept in mathematics and logic that if relation "A" is related to "B", and "B" is related to "C", then "A" is related to "C".

Prefers

Indicates a choice or inclination for one option over others based on certain criteria or personal judgment.

Transitivity

In decision theory and economics, the concept that if option A is preferred to B, and B is preferred to C, then A should be preferred to C.

Kenneth Arrow

An influential economist known for his groundbreaking theories in risk, welfare economics, and his contribution to the general equilibrium theory.

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