Differentiate between "off-budget" deficit and the "on-budget" deficit
Social Security expenditures and the payroll tax receipts that finance them are treated as off-budget items. Because Social Security benefits are financed by an earmarked revenue source?the payroll tax?Social Security and a few minor items have traditionally been segregated in the federal fiscal accounts. Most other expenditures and receipts are classified as on-budget.
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In the traditional Keynesian model, if the government increases spending, then
A) consumption will increase, and so real Gross Domestic Product (GDP) will increase by more than the increase in government spending. B) consumption will decrease, and so real Gross Domestic Product (GDP) will increase by less than the increase in government spending. C) consumption will remain the same, and so real Gross Domestic Product (GDP) will increase by the same amount of the increase in government spending. D) consumption will increase or decrease, and so real Gross Domestic Product (GDP) will increase or decrease depending on the change in consumption.
If output decreases, which of the following would occur?
a. Prices of non-labor inputs, input requirements per unit of output and unit costs would all increase and the economy would move upward along the aggregate supply curve. b. Prices of non-labor inputs, input requirements per unit of output and unit costs would all decrease and the economy would move upward along the aggregate supply curve. c. Prices of non-labor inputs, input requirements per unit of output and unit costs would all increase and the economy would move downward along the aggregate supply curve. d. Prices of non-labor inputs, input requirements per unit of output and unit costs would all decrease and the economy would move downward along the aggregate supply curve. e. Prices of non-labor inputs would decrease, input requirements per unit of output would increase and the economy would move upward along the aggregate supply curve.
The concept of external benefit is associated with a negative externality, but not with a positive externality
a. True b. False Indicate whether the statement is true or false
If peanuts were widely accepted for purposes of exchange, then
A) peanuts would be money. B) peanuts would be less valuable than they are currently. C) we would observe people using peanuts to purchase cars. D) a and c E) a and b