The automatic mechanism can best be described as:
A) the process of the economy adjusting back to potential GDP without any action taken by the government
B) the result of monetary policy implemented by the Fed restoring full employment
C) how fiscal policy is used to return the economy to its potential
D) using rule-based policies to stabilize the economy
A
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A firm's vertical dimension refers to
A) its ability to grow its profits. B) the size of its headquarters building. C) the degree to which it participates in the various stages of producing the products and services it sells. D) the downstream stages of production.
Which of the following perspectives exerted the most impact on fiscal policy during the Great Depression?
a. the Keynesian view b. the supply-side view c. the view that the federal government should maintain a balanced budget d. the new classical view that fiscal policy exerts little impact on demand and output