Question: Automatic stabilizers a. reduce the problems caused by lags, using fiscal policy as a stabilization tool. b. are changes in fiscal policy that act to

Automatic stabilizers

a. reduce the problems caused by lags, using fiscal policy as a stabilization tool.

b. are changes in fiscal policy that act to stimulate AD automatically when the economy goes into recession.

c. are changes in fiscal policy that act to restrain AD automatically when the economy is growing too fast.

d. All of the above are correct.

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