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During a recession, total public assistance payments and unemployment compensation payments automatically increase while income taxes automatically...

During a recession, total public assistance payments and unemployment compensation payments automatically increase while income taxes automatically decrease. Which of the following best describes the effect of these changes on aggregate demand? 
Answer
a. Aggregate demand will be the same as it was before the recession.
b. Aggregate demand will be greater than it was before the recession.
c. Aggregate demand will be more than it would be without these automatic stabilizers.
d. Aggregate demand will be less than it would be without these automatic stabilizers.

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Economics-8206063.doc

During a recession, total public assistance payments and unemployment compensation payments automatically increase while income taxes automatically decrease. Which of the following best describes...

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