Purchases made by governments over the business cycle
A) move procyclically with GDP as governments that collect more or less in taxes over the cycle spend more or less on goods and services.
B) move countercyclically with GDP as governments try to smooth out the cycle by spending more on goods and services in recession and less during booms.
C) are not very well correlated with changes in GDP because discretionary adjustments in purchasing arrangements take a long time to consummate and are almost never canceled.
D) are one of the major causes of business cycles as we now understand them.
E) none of the above.
Correct Answer:
Verified
Q7: The federal deficit of the United States,
Q8: Which of the following reasons might explain,
Q9: Purchases of goods and services by the
Q10: Indexing federal income tax rates to inflation
Q11: The tax elasticity for the federal government
Q13: Which of the following statements is an
Q14: Which of the following statements about the
Q15: The budget of the U.S. federal government
Q16: The budget of the U.S. federal government
Q17: Outlays by the federal government in 2003
A)
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents