Those who are concerned about balanced budget amendments typically argue that:
A) they would make fluctuations in output around the natural level of output greater.
B) they would reduce national saving.
C) they would cause interest rates to be higher than they otherwise would be.
D) they would reduce aggregate demand.
E) they would increase spending in a recession.

Question

Quizplus · Accepted Answer

Balanced budget amendments can limit the government's ability to use fiscal policy to stabilize the economy, potentially leading to greater fluctuations in output around the natural level of output.

Those Who Are Concerned About Balanced Budget Amendments Typically Argue