Which of the following would increase the cyclically adjusted deficit? a.) a dec
ID: 1204748 • Letter: W
Question
Which of the following would increase the cyclically adjusted deficit?
a.) a decrease in income
b.) an increase in income
c.) a decrease in the primary deficit
d.) an increase in the primary deficit
e.) none of the above
Given nominal money growth, the amount of seigniorage will be greater than
a. foreign lending is higher
b. real money balances
c. the inflation rate is higher
d. tax revenues are higher
e. none of the above
The official measure of the deficit is equal to
a. rB - G + T
b. iB + T - G
c. iB + G - T
d. (i - pie)B + G -T
e. none of the above
If the Ricardian equivalence proposition is correct, then an increase in the deficit will lead to
a.) a decrease in investment spending
b.) an increase in private saving
c.) a lower standard of living in the future
d.) all of the above
e.) none
The United states financed the additional government spending during world War II through
a. increase in both the deficit and imports
b. an increase in taxes
c. an increase in imports
d. an increase in the deficit
e. increase in both the deficit and taxes
Please help me with this multiple choice Economics questions. thanks :)
Explanation / Answer
(1) The correct answer is option (d). The increase in the cyclically adjusted deficit shows an increase in the primary deficit.
(2) The correct answer is option (c). Given nominal money growth, the amount of seigniorage will be greater than the inflation rate is higher.
(3) The correct answer is option (c). The official measure of the deficit is equal to iB + G - T.
(4) The correct answer is option (b). If the Ricardian equivalence proposition is correct, then an increase in the deficit will lead to an increase in private saving.
(5) The correct answer is option (e). The United states financed the additional government spending during world War II through increase in both the deficit and taxes.
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