Suppose that the federal budget is balanced when GDP is at potential GDP. If equilibrium GDP falls below potential,
A) this will result in a current budget deficit.
B) government transfer payments will be rising and tax receipts will be falling.
C) the cyclically adjusted budget will be balanced.
D) All of the above are correct.
D
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Demand-pull inflation:
A. occurs when prices of resources rise, pushing up costs and the price level. B. occurs when total spending exceeds the economy's ability to provide output at the existing price level. C. occurs only when the economy has reached its absolute production capacity. D. is also called cost-push inflation.
According to Darity and Myers
A. black men are becoming increasingly marginal to our economy. B. the basic cause of poverty is welfare dependency. C. the best solution to poverty is the negative income tax. D. as our economy continues to expand, black poverty will decline.