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Assume That the Total Deficit Is $100 Billion and the Economy

Question 43

Multiple Choice

Assume that the total deficit is $100 billion and the economy is above potential output.Now the level of economic activity falls back to its potential level output,leading to an decrease in tax revenues increase by $50 billion an increase in transfer payments fell by $10 billion.Then,what is the structural deficit?


A) $100 billion
B) $110 billion
C) $150 billion
D) $160 billion
E) can't tell based on information given.

Correct Answer:

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