Which of the following is an example of an automatic stabiliser in the economy?
A. Progressive income tax
B. Change in repo rate
C. Open market operations
D. Discretionary government spending
Answer: Option A
Solution (By JKSSB Mock Tests)
Automatic stabilisers are features of the fiscal system that automatically dampen economic fluctuations without new legislation. Progressive income tax reduces disposable income during booms and increases it during recessions.
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