Because automatic stabilizers exist in the United States economy

A) during a recession,transfer payments automatically rise and tax revenue drops;during a period of economic recovery,transfer payments fall and tax revenue rises.
B) real wages automatically adjust to keep the labor force fully employed at all stages of the business cycle.
C) monetary policy is designed to automatically respond to changes in money demand.
D) during a recession,the government's budget deficit automatically becomes smaller.
E) All of the choices/statements are true.

Automatic Stabilizers

Economic policies and programs, like unemployment benefits and progressive taxation, that automatically help stabilize economic fluctuations without direct governmental intervention.

Economic Recovery

A period of increasing business activity signaling the end of a recession, marked by a rise in GDP, employment, and consumer spending.

Transfer Payments

These are payments made by the government to individuals or other entities without expecting any goods or services in return, such as social security benefits or unemployment compensation.