If the federal budget has an actual budget surplus of $75 billion,but a cyclically adjusted budget surplus of $50 billion,then the economy must be above potential real GDP.

Question

Quizplus · Accepted Answer

A cyclically adjusted budget surplus that is smaller than the actual budget surplus indicates that part of the surplus is due to high levels of economic activity above potential GDP, leading to higher tax revenues and/or lower government spending on welfare programs.

If the Federal Budget Has an Actual Budget Surplus of $75