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How Are Automatic Stabilizers Used To Combat Inflation?
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In today's economy, there are devices present called automatic
stabilizers. Automatic stabilizers, are mechanisms which aid in the correction
of an economic problem without the interference of anyone or anything. They are
perhaps most useful to combat demand - pull inflation. Demand - pull inflation,
is when prices rise because the economy ca ....
Middle of paper
....t spending, and lowering the gross domestic product.
Due to such automatic stabilizers as progressive tax rates and the
decrease of government spending due to welfare, therefore a decrease in
government borrowing, therefore a decrease in the demand for the dollar,
therefore a decrease in the interest rate, which would cause a decrease in the
forei.... |
| Word count: 386 |
Page count: 2 |
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