Question

If the government increases its spending when the economy is expanding, automatic stabilizers _____ the government spending multiplier.

Answer 1

If the government increases its spending when the economy is expanding, automatic stabilizers will decrease the government spending multiplier.

An economy is a region where products and services are produced, distributed, traded, and consumed. It is generally understood to be a social domain that places an emphasis on the behaviors, discourses, and tangible manifestations connected to the creation, utilization, and management of finite resources.

One's culture, values, education, technological advancement, history, social organization, political structure, legal system, and natural resources are all major determinants of an economy's processes. These elements determine the parameters and conditions under which an economy operates in addition to providing background and content.

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