If income increases, a budget deficit will:
A. tend to increase.
B. not change.
C. change unpredictably.
D. tend to decrease.
Answer: D
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A consumer values a car at $30,000 and a producer values the same car at $20,000 . If the transaction is completed at $24,000 . the transaction will generate:
a. No surplus b. $4,000 worth of seller surplus and unknown amount of buyer surplus c. $6,000 worth of buyer surplus and $4,000 of seller surplus d. $6,000 worth of buyer surplus and unknown amount of seller surplus
Crowding out occurs
a. when an increase in government spending crowds out tax revenues. b. when an increase in government spending increases investment spending. c. when an increase in government spending crowds out bonds. d. when an increase in government spending crowds out other types of spending. e. when an increase in government spending crowds out the money supply.
Which of the following is true if equilibrium is present in a market?
a. Quantity demanded equals quantity supplied. b. Quantity supplied exceeds quantity demanded. c. There is generally either a shortage or a surplus. d. Quantity demanded exceeds quantity supplied.
Figure 17-6
The domestic country is China.
Refer to . If China were to abandon a no-trade policy in favor of a free-trade policy,
a.
Chinese producers of pencil sharpeners would become worse off.
b.
Chinese consumers of pencil sharpeners would become better off.
c.
total surplus in the Chinese economy would increase.
d.
All of the above are correct.