The correct answer is d. Unemployment benefit payments to the unemployed.

Step 1: Understand the question. An automatic stabilizer is a type of fiscal policy that automatically changes with the economic conditions to stabilize an economy.

Step 2: Evaluate each option.

a. Increases in government spending on schools. This is a discretionary fiscal policy, not an automatic stabilizer.

b. Interest rate changes. This is a monetary policy tool, not an automatic stabilizer.

c. Reductions in nominal wages as inflation rates rise. This is a result of economic conditions, not a policy tool.

d. Unemployment benefit payments to the unemployed. This is an automatic stabilizer because the amount of unemployment benefits automatically increases when the economy is in a downturn (more people are unemployed) and decreases when the economy is doing well (fewer people are unemployed).

So, the correct answer is d. Unemployment benefit payments to the

Question

The correct answer is d. Unemployment benefit payments to the unemployed.

Step 1: Understand the question. An automatic stabilizer is a type of fiscal policy that automatically changes with the economic conditions to stabilize an economy.

Step 2: Evaluate each option.

a. Increases in government spending on schools. This is a discretionary fiscal policy, not an automatic stabilizer.

b. Interest rate changes. This is a monetary policy tool, not an automatic stabilizer.

c. Reductions in nominal wages as inflation rates rise. This is a result of economic conditions, not a policy tool.

d. Unemployment benefit payments to the unemployed. This is an automatic stabilizer because the amount of unemployment benefits automatically increases when the economy is in a downturn (more people are unemployed) and decreases when the economy is doing well (fewer people are unemployed).

So, the correct answer is d. Unemployment benefit payments to the

Knowee AI · Accepted Answer

The correct answer is d. Unemployment benefit payments to the unemployed.

Step 1: Understand the question. An automatic stabilizer is a type of fiscal policy that automatically changes with the economic conditions to stabilize an economy.

Step 2: Evaluate each option.

a. Increases in government spending on schools. This is a discretionary fiscal policy, not an automatic stabilizer.

b. Interest rate changes. This is a monetary policy tool, not an automatic stabilizer.

c. Reductions in nominal wages as inflation rates rise. This is a result of economic conditions, not a policy tool.

d. Unemployment benefit payments to the unemployed. This is an automatic stabilizer because the amount of unemployment benefits automatically increases when the economy is in a downturn (more people are unemployed) and decreases when the economy is doing well (fewer people are unemployed).

So, the correct answer is d. Unemployment benefit payments to the

Which of the following is an automatic stabiliser? a. Increases in government spending on schools. b. Interest rate changes. c. Reductions in nominal wages as inflation rates rise. d. Unemployment benefit payments to the unemployed.

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Which of the following is an automatic​ stabiliser? a. Increases in government spending on schools. b. Interest rate changes. c. Reductions in nominal wages as inflation rates rise. d. Unemployment benefit payments to the unemployed.

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Which of the following is an automatic stabiliser? a. Increases in government spending on schools. b. Interest rate changes. c. Reductions in nominal wages as inflation rates rise. d. Unemployment benefit payments to the unemployed.