Question: Suppose that for every 1 percentage point increase (decrease) in GDP growth, automatic stabilizers 1. Increase (decrease) tax revenues by $90 billion and 2. Decrease

Suppose that for every 1 percentage point increase (decrease) in GDP growth, automatic stabilizers

1. Increase (decrease) tax revenues by $90 billion and

2. Decrease (increase) transfer payments by $30 billion.

Using this information, complete the table.

Change In Transfer Change In Tax Change Change In Budget In GDP Growth Balance (billions) Revenue Payments (billions) (b

Change In Transfer Change In Tax Change Change In Budget In GDP Growth Balance (billions) Revenue Payments (billions) (billions) Rate -2% +1% +3%

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