Multiple Choice
-Refer to the above diagram. Assume that G and T1 are the relevant curves and that the economy is currently at B, which is its full-employment GDP. This economy has a:
A) cyclically adjusted budget surplus only.
B) cyclically adjusted budget deficit only.
C) cyclically adjusted budget surplus and an actual budget surplus.
D) cyclically adjusted deficit and an actual budget deficit.
Correct Answer:
Verified
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