Refer to the diagram, where T is tax revenues and G is government expenditures. All figures are in billions of dollars. If the full-employment GDP is $400 billion while the actual GDP is $200 billion, the actual budget deficit is:
A. $200 billion.
B. $20 billion.
C. $40 billion.
D. $60 billion.
C. $40 billion.
You might also like to view...
When individuals form an alliance to ensure that all members will volunteer in case of a volunteer's dilemma, this is called
A) compulsory volunteerism. B) coalition building. C) bargaining. D) eminent domain.
If an individual receives $10,000 after two years by investing $10,000 today, we can conclude that ________
A) the rate of inflation is zero B) the market rate of interest is zero C) the rate of inflation is negative D) the market rate of interest is negative
Tony's Taco Truck has an average variable cost of $1.50 and a marginal cost of $2 when it produces 50 units of output (tacos). We can conclude that the average variable cost of producing 51 tacos is a. higher than $1.50
b. lower than $1.50. c. equal to $1.50 d. either higher or lower than $1.50 depending on the direction of the marginal cost curve.
If the short-run Phillips curve has a very steep slope, the
A. structural deficit will grow during inflation. B. structural deficit will fall during recession. C. inflation costs of reducing unemployment are relatively low. D. inflation costs of reducing unemployment are relatively high.