A policy of fiscal austerity could have difficulty lowering the debt-to-GDP ratio because it might:
A) lower potential output and government spending.
B) raise both GDP and government revenue.
C) lower both GDP growth and government revenue.
D) raise potential output and government spending.
Correct Answer:
Verified
Q29: During World War II, the economic boom
Q30: If actual income is $300 billion, potential
Q31: If actual income is $300 billion, potential
Q32: If taxes and government expenditures were constant
Q33: When the economy is operating close to
Q35: The structural deficit:
A)rises as the economy expands
Q36: The cyclical deficit:
A)is not affected by changes
Q37: Economists who focus on the need for
Q38: Compared to the predictions of the standard
Q39: If income falls below its potential and
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