In July 2005,the U

question 54

True/False

In July 2005,the U.S.House of Representatives approved the formation of NAFTA,a regional trade agreement designed to eliminate tariffs on products moving between Mexico,Canada,and the United States by 2004.

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Definitions:

Automatic Stabilizer

Economic policies and programs, such as unemployment benefits and taxation, that automatically adjust to counteract economic fluctuations without direct intervention by policymakers.

Crowding-out

A situation where increased public sector spending leads to a reduction in private sector spending.

Accelerator Effect

Refers to the phenomenon where an increase in national income results in a proportionally larger increase in investment spending due to expected higher demand for products.

Aggregate Demand

The sum of all demands for products and services in an economy, set at a particular price level and time period.