During a Recession,the Budget Deficit Generally Increases Because Tax Revenues

question 3

Multiple Choice

During a recession,the budget deficit generally increases because tax revenues weaken while expenditures rise.This increase is known as the

• A) automatic stabilizer.
• B) net stimulus increase.
• C) automatic increase.
• D) fiscal stabilizer.

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Definitions:

Breach

An act of breaking or failing to observe a law, agreement, or code of conduct.

Principal's Termination

The end of an agency relationship by the decision of the principal, who is the individual or entity that has empowered another to act on their behalf.

Exclusive Agency

An agency in which a principal grants an agent an exclusive territory and does not allow another agent to compete in that territory.

Liable

Refers to being legally responsible to compensate or rectify a damage, loss, or breach of contract.