A constitutional amendment is passed that requires the government to have an annually balanced budget in the sense that changes in spending should be matched by equivalent changes in taxes. Should the government desire to increase GDP by $25 billion and meet the provisions of the law it:
A. Cannot possibly reach its objective without breaking the law
B. Could increase spending by $25 billion and reduce taxes by $25 billion
C. Could increase spending by $25 billion and increase taxes by $25 billion
D. Could increase spending by $30 billion and increase taxes by $25 billion
C. Could increase spending by $25 billion and increase taxes by $25 billion
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Which of the following is not true regarding the argument for protection as a way of maintaining jobs and wage levels?
a. Wages may be only a small fraction of total production costs. b. High wages do not necessarily imply high labor costs when productivity is taken into account. c. U.S. workers are among the most productive in the world partly because they are well educated and trained compared to other countries. d. U.S. workers are highly productive partly because they are provided with abundant supplies of machines and physical capital. e. It is not possible that the U.S. wages, even when supported by high U.S. output per worker, can render U.S. products competitive with low-wage countries.
A structural stagnation is a:
A. business cycle with smaller fluctuations around the trend. B. business cycle with greater fluctuations around the trend. C. slow expansion that involves slower growth than the previous long run trend. D. business cycle in which unemployment rises during the downturn and rises during the expansion.
The most important reason for why some people have higher incomes than others is
A. employment discrimination. B. differences in wages and salaries. C. property income. D. government transfer payments.
In the long run a firm will choose a plant size that has the:
A. Minimum of average fixed costs B. Capacity to produce the largest quantity of the product C. Minimum average total cost of producing the target level of output D. Maximum level of resource use per unit of the total product of output