The difference between the official and correct measures of the deficit will be greater:
A) the higher is the level of debt.
B) the lower is taxes.
C) the lower is the level of debt.
D) the lower is inflation.
E) the lower is government spending.

Question

Quizplus · Accepted Answer

As the level of debt increases, there is a higher likelihood that the government will use accounting techniques to manipulate the deficit figures. This can result in a larger discrepancy between the official and correct measures of the deficit.

The Difference Between the Official and Correct Measures of the Deficit