Assume that the economy is in a recession and there is a budget deficit. A strict balanced-budget rule that would require the Federal government to balance its budget during a recession would be:
A. Expansionary and worsen the effects of the recession
B. Contractionary and worsen the effects of the recession
C. Contractionary and counter the effects of the recession
D. Expansionary and counter the effects of the recession
B. Contractionary and worsen the effects of the recession
You might also like to view...
An income tax for which the average tax rate decreases with income is called a
A) regressive income tax. B) proportional income tax. C) flat-rate income tax. D) progressive income tax.
Which of the following is false? a. An increase in labor productivity will shift the demand curve for labor to the right
b. An increase in wage will lead to an increase in the supply of labor. c. A decrease in the nonwage income of workers would shift the labor supply curve to the right. d. If job amenities deteriorate, it would lead to a reduction, or leftward shift, in the labor supply curve.