To evaluate the size of the federal budget deficit or surplus over time,it would be best to look at the
A)absolute size of the budget deficit or surplus.
B)budget deficit or surplus as a percentage of GDP.
C)budget deficit or surplus as a percentage of tax revenues.
D)budget deficit or surplus as a percentage of government spending.

Question

Quizplus · Accepted Answer

Looking at the budget deficit or surplus as a percentage of GDP is the best choice because it takes into account the size of the economy and allows for comparison over time. A larger deficit may not necessarily be a problem if the economy is growing at a similar rate, while a smaller deficit may be problematic if the economy is stagnant or contracting.

To Evaluate the Size of the Federal Budget Deficit or Surplus