If government spending that gives rise to a budget deficit is for public investment projects such as highways, this spending can increase the economy's future production capacity.
Answer the following statement true (T) or false (F)
True
You might also like to view...
Which of the following $5,000 face-value securities has the highest yield to maturity?
A) a 6 percent coupon bond selling for $5,000 B) a 6 percent coupon bond selling for $5,500 C) a 10 percent coupon bond selling for $5,000 D) a 12 percent coupon bond selling for $4,500
Which of the following government outlays would be classified as a transfer payment?
A) payments of veterans benefits under the GI bill B) interest on the federal debt C) subsidies to gold-mining firms D) all of these
Full employment occurs when
a. everyone has a job b. everyone who wants a job has one c. there is no frictional unemployment d. there is no cyclical unemployment e. there is no structural, frictional, and seasonal unemployment
In the long run, if the Fed decreases the growth rate of the money supply,
a. inflation will be lower. b. unemployment will be higher. c. real GDP will be lower. d. All of the above are correct.