Figure 5-1

-In Figure 5-1 above,if the budget line BB₀,the natural real GDP is $5300,and actual real GDP is $5000,then the cyclical budget surplus or deficit is the

Question

Figure 5-1
 
-In Figure 5-1 above,if the budget line BB₀,the natural real GDP is $5300,and actual real GDP is $5000,then the cyclical budget surplus or deficit is the

Quizplus · Accepted Answer

The cyclical budget surplus or deficit can be determined by finding the vertical distance between the actual real GDP (point F) and the budget line BB₀. In this case, the vertical distance between F and D represents the cyclical deficit since actual real GDP is below the natural real GDP.

Figure 5-1 -In Figure 5-1 Above,if the Budget Line BB₀,the Natural Real