Why don't governments avoid budget deficits under all circumstances?
Budget deficits can be important because they provide the federal government with the flexibility to respond appropriately to changing economic circumstances. The government may run deficits during special emergencies. The government may also use a budget deficit to avert an economic downturn.
You might also like to view...
Which of the following markets are closest to perfectly competitive
a. The market for smart phones b. The market for generic pharmaceuticals c. The market for sport shoes d. The market for fast food
In summarizing the research on the externalities associated with driving cars, a 2007 Journal of Economic Literature article concluded that the optimal corrective tax on gasoline in the United States, in 2015 dollars, would be about
a. $0.50 per gallon. b. $0.90 per gallon. c. $2.58 per gallon. d. $2.78 per gallon.
What is the cross-price elasticity between beef and vegetables for a strict vegan when the price of vegetables increases?
A. Zero B. Either zero or negative depending on whether the vegan eats less vegetables. C. Positive D. Negative
Which of the following statements is true?
A. The inclusion of intermediate goods and services into GDP calculations would underestimate our nation's production level. B. The expenditures approach sums the compensation of employees, rents, profits, net interest, and nonincome expenses for depreciation and indirect business taxes. C. Real GDP has been adjusted for changes in the general level of prices due to inflation. D. Real GDP equals nominal GDP multiplied by the GDP deflator.