Suppose the economy was at full employment GDP and then consumer optimism soars. If automatic stabilizers are in place, the stabilizers will result in:
a. higher tax collection and lower government spending on transfer payments, which helps slow growth in real GDP.
b. lower tax collection and lower government spending on transfer payments, which helps offset a recession.
c. lower tax collection and higher government spending on transfer payments, which helps slow growth in real GDP.
d. higher tax collection and higher government spending on transfer payments, which helps offset a recession.
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