If taxes and government expenditures were constant and did not vary with income, then:
A. cyclical deficits would not exist.
B. cyclical deficits would increase.
C. structural deficits would not exist.
D. structural deficits would increase.
Answer: A
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The supply curve for a normal good always slopes downward because a rise in the price of a normal good almost always leads to an increase in the quantity supplied of that good
a. True b. False Indicate whether the statement is true or false
"Market power" is an expression used to indicate that a firm has
a. no rivals. b. the power to sell a given output at whatever price it chooses. c. some freedom from the rigors of intense competition. d. a monopoly over the product it produces.
In a free-market economy, a product which entails a positive externality will be:
A. Overproduced B. Underproduced C. Produced at the optimal level D. Provided solely by the government
As a result of adverse selection problems in the health insurance market, it is likely that over time
A. fewer healthy and unhealthy people will be insured. B. more healthy people will be insured. C. fewer unhealthy people will be insured. D. fewer healthy people will be insured.