Which of the following is an example of an automatic stabilizer?Group of answer choicesdiscretionary spendinggovernment bailouts of firmsunemployment benefitsmilitary expenditures
Question
Which of the following is an example of an automatic stabilizer?Group of answer choicesdiscretionary spendinggovernment bailouts of firmsunemployment benefitsmilitary expenditures
Solution
To determine which of the options is an example of an automatic stabilizer, we need to understand what an automatic stabilizer is. An automatic stabilizer is a government policy or program that helps stabilize the economy during periods of economic downturns or recessions without requiring specific action from policymakers.
Looking at the given options, we can eliminate discretionary spending and government bailouts
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