The federal budget tends to move toward _____ as the economy ____.

Question

Quizplus · Accepted Answer

When the economy contracts, tax revenues tend to decline and spending on programs such as unemployment benefits tend to increase, leading to a larger deficit for the federal government. Conversely, when the economy expands, tax revenues tend to increase and spending on programs like unemployment benefits tend to decrease, leading to a smaller deficit or even a surplus.

The Federal Budget Tends to Move Toward _____ as the Economy