In the long-run framework, budget surpluses:
A) should be run whenever output dips below potential output.
B) should never be run since they crowd out investment in the short run.
C) are better than budget deficits over the long run because unlike budget deficits, they increase saving and investment.
D) should be run on a permanent basis since they boost saving and investment and stimulate economic growth.
Correct Answer:
Verified
Q8: Deficits may be desirable in the short
Q9: A budget surplus is defined as:
A)a shortfall
Q10: The real deficit is the nominal deficit
Q11: The portion of the budget deficit or
Q12: Economists believe that an increase in equilibrium
Q14: In the long-run framework, deficits reduce:
A)investment.
B)government consumption.
C)taxes.
D)subsidies.
Q15: A country that is running a budget
Q16: Much of the U.S. debt is held
Q17: Economists who focus on fiscal austerity focus
Q18: The larger the debt and the inflation
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