If It Were Not for the Automatic Stabilizers in the U.S.economy

question 30

Multiple Choice

If it were not for the automatic stabilizers in the U.S.economy,

• A)the Federal Reserve would have less reason than it has now to monitor stock prices.
• B)it would be more desirable than it is now for the Federal Reserve to target an interest rate.
• C)a strict balanced-budget rule would be more desirable than it is now.
• D)output and employment would probably be more volatile than they are now.

---

Definitions:

Proprietorship

A business structure owned by a single individual, where the owner and the business are legally treated as the same.

Basic Accounting Equation

Assets equal liabilities plus equity; the foundational equation in accounting expressing the principle of balance in a firm's financial position.

Owner's Equity

The remaining value of a company's assets after all liabilities have been subtracted, indicating the stake of ownership in the enterprise.

Assets

Economic resources or owned valuables that are expected to provide future benefits to a business.