1. When the economy enters a recession, automatic stabilizers create a. higher taxes. b. more…

1. When the economy enters a recession, automatic stabilizers create a. higher taxes. b. more discretionary spending. c. budget deficits. d. budget surpluses. 2. Automatic stabilizers “lean against the prevailing wind” of the business cycle because a. wages are controlled by the minimum wage law.
b. federal expenditures and tax revenues change as the level of real GDP changes.
c. the spending and tax multipliers are constant.
d. they include the power of special interests.