When the economy is at full employment,
A)one cannot generalize in comparing the actual and the cyclically adjusted budgets.
B)the cyclically adjusted budget will show a surplus and the actual budget will show a deficit.
C)the actual budget will show a surplus and the cyclically adjusted budget will show a deficit.
D)the actual and the cyclically adjusted budgets will be equal.

Question

Quizplus · Accepted Answer

When the economy is at full employment, the actual budget and the cyclically adjusted budget are equal because there are no cyclical fluctuations affecting the budget balance.

When the Economy Is at Full Employment