Suppose that investment is $1,400 billion, saving is $1,300 billion, government expenditure on goods and services is $1,700 billion, exports are $1,800 billion, and imports are $2,600 billion.
Tax revenue is ________ billion dollars.
The government budget balance is _________ billion dollars.
1,000 (Tax Revenue = Investment + Government Expenditure + Exports - Saving - Imports)
-700 (Tax Revenue - Government Expenditure)
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Changes in which of the following change the demand for capital and shifts the demand curve for capital?
A) current income B) expected future income C) the rental rate D) the marginal product of capital
A balanced budget occurs when
A) the national debt is reduced to zero dollars. B) a budget deficit during one year is matched by a budget surplus in the next year. C) transfer payments equal tax revenues. D) government expenditures equal tax revenues. E) the deficit-GDP ratio equals one.
If aggregate demand falls short of current output, business firms will ________ production to ________ inventories
A) cut; keep from accumulating B) expand; keep from accumulating C) cut; build up D) expand; build up
One should ignore the degree of income inequality _____
a. when one considers the design of redistribution programs b. when one only cares about improving the lot of the worst off in society c. when considering whether or not to transfer resources from the rich to the poor d. when considering progressive taxation