Suppose the government's initial debt is $400 billion. If for the next three years the government runs deficits of $150, $125, and $200 billion, the government's additional debt at the end of the three years will be
A) -$50 billion. B) $50 billion. C) $475 billion. D) $900 billion.
C
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If U.S. interest rates rise while foreign interest rates remain unchanged,
A. GDP will not change since the shift in aggregate supply cancels the positive effects on aggregate demand. B. the dollar will depreciate and thus reduce prices and output. C. foreign capital will be attracted to the United States and the dollar will appreciate. D. net exports will increase and the economy will expand.
In the case where cigarette firms conceal information about the negative externalities associated with cigarette smoking, the market is said to be characterized by
a. asymmetric information b. moral hazard c. social cost d. government failure e. greed
Centrally planned economies have historically been more damaging to the environment than capitalist ones.
Answer the following statement true (T) or false (F)
When the price level increases people:
A. feel more wealthy. B. demand a smaller quantity of goods and services in the aggregate. C. have the same real value of assets, regardless of the change in the price level. D. want to spend more, but can't due to the prices of all goods and services going up.