Answer the next question using the following budget information for a hypothetical economy. All data are in billions of dollars. Government SpendingTax RevenuesGDPYear 1$800$825$4,000Year 28508504,200Year 39008754,350Year 49509004,500Year 51,0009254,600The budget deficit was $75 billion in
A. Year 2.
B. Year 3.
C. Year 4.
D. Year 5.
Answer: D
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The break-even point refers to
A) the amount of autonomous consumption. B) a point at which planned real consumption is for greater than real disposable income. C) the point at which planned real consumption equals real disposable income. D) the maximum amount of dissaving a person can experience.
Which of the following is most likely to happen, if investment in an economy falls?
A) Firms' revenue rise. B) Mortgage defaults fall. C) Labor supply falls. D) Unemployment rises.
In general we can note that households with lower wealth tend to have a ____ MPC relative to wealthier households.
A. lower B. higher C. similar D. exactly equivalent
An increase in the price of cheese crackers from $2.25 to $2.45 per box causes suppliers of cheese crackers to increase their quantity supplied from 125 boxes per minute to 145 boxes per minute. Using the midpoint method, supply is
a. elastic, and the price elasticity of supply is 1.74. b. elastic, and the price elasticity of supply is 0.57. c. inelastic, and the price elasticity of supply is 1.74. d. inelastic, and the price elasticity of supply is 0.57.