Question

During recessionary periods: a outlays decrease and tax revenue increases. b outlays and tax revenue stay the same. c outlays decrease and tax revenue falls. d outlays increase and tax revenue falls. e outlays increase and tax revenue increases.

Answer 1

D

Step-by-step explanation:

A recession is when the GDP of an economy for two consecutive quarters is negative.

In a recessionary period, income falls and as a result tax falls. this makes tax is an automatic stabilizer.

The government would also increase spending in order to stimulate the economy