A structural deficit
A)is present only if real GDP is greater than potential.
B)exists even if real GDP equals potential.
C)equals the cyclical deficit plus the actual deficit.
D)occurs when the economy is in a recession.
E)is greater than a cyclical deficit.

Question

Quizplus · Accepted Answer

A structural deficit exists even if real GDP equals potential. It is a deficit that results from long-term imbalances between government spending and revenue, regardless of the state of the economy or cyclical fluctuations.

A Structural Deficit