Which of the following statements is correct? Multiple Choice Built-in stability only partially offsets fluctuations in economic activity. Built-in stability has eliminated the need for discretionary fiscal policy. Built-in stability can be relied on to eliminate completely any fluctuation in economic activity. Built-in stability works in halting inflation, but it cannot alleviate unemployment.

Built-in stability only partially offsets fluctuations in economic activity.

Explanation:

The built instability is the policies that affect the economic policies that are triggered without the direct governmental disturbances in order to stabilize the economic cycles when the growth slows down. A common example is unemployment insurance when the economy falls into a recession people lose jobs and thus unemployment subsidies are provided and that increases the budget deficits that in turn becomes an incentive for stimulating the economy. The best known inbuilt economic stabilizers are the transfer system, corporate and personal tax.