In contrast to the structural deficit,the cyclical deficit reflects
A)Fluctuations in economic activity.
B)Fiscal policy decisions.
C)Changes in discretionary fiscal policy.
D)Changes in the "full-employment" deficit.

Question

Quizplus · Accepted Answer

The cyclical deficit reflects fluctuations in economic activity, particularly during periods of recession or expansion. It is influenced by factors such as changes in consumer spending, business investment, and overall economic growth. This is in contrast to the structural deficit, which is a long-term imbalance between government spending and revenue that persists regardless of business cycle fluctuations.

In Contrast to the Structural Deficit,the Cyclical Deficit Reflects