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Suppose the Government Implemented Cyclically Balanced Government Budgets

Question 122

Multiple Choice

Suppose the government implemented cyclically balanced government budgets.Such a policy


A) would result in larger output gaps than with annually balanced budgets.
B) would require precise prediction of the business cycle.
C) would eliminate the need for built-in fiscal stabilizers.
D) is easier with frequent changes in political power.
E) is successfully practiced in Canada.

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