Identify an “automatic stabilizer” and describe the impact it has had on the economy in recent...

Identify an “automatic stabilizer” and describe the impact it has had on the economy in recent years.

Expert Solution

Economic policies and programs that brings fluctuations in nation's Economic activity.
Best known Automatic stabilizers are corporate and personal taxes, transfer systems such as Insurance, unemployment and welfare.

Unemployment, Insurance and welfare:-

Benefits received by workers if they have lost their jobs.
Workers who terminate the Employment or the self Employed ones are not Eligible for their insurance.
They can avail personal funds.
State governments are responsible for the payment of unemployment insurance.
It is a joint program initiated by Individual state governments and federal government.
Every state has an unemployment insurance program.
All states must follow guide lines put forward by federal law.
Workers who meet the eligibility criteria will receive 26 weeks of cash benefits.
State fund unemployment insurance using taxes is put on the Employers
The state must also give minimal Employee contributions to the state Employment fund .
Two primary requirements to be met for unemployment insurance benefits.

Individual must meet a threshold of either earned wages or time worked in a base period.
Person must be Unemployed without his fault of his own.

Rahul Sunny answered 2 years ago

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