Provisions in the Law That Imply Automatic Increases in Government

question 153

Multiple Choice

Provisions in the law that imply automatic increases in government spending,or decreases in taxes,when real output declines are called

• A) autonomous stabilizers.
• B) automatic stabilizers.
• C) the marginal propensity to consume.
• D) the income-expenditure multiplier.
• E) induced planned aggregate expenditurE.

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Definitions:

Risk Averse

A description of an individual or entity's preference to avoid uncertainty, often choosing options with more predictable outcomes.

Probability

A measure of the likelihood that an event will occur, expressed as a number between 0 and 1.

Utility Function

Describes how a consumer ranks different baskets of goods based on the level of satisfaction or utility derived from them.

Expected Utility

A concept in economics that represents a consumer's preference for certain outcomes, quantified as the weighted average of utility over all possible outcomes.