If the government of a developing country reduces its budget deficit, then the inflation tax:
A. should decrease.
B. should not change.
C. may increase, decrease, or not change depending on whether the government cuts taxes or raises government expenditures.
D. should increase.
Answer: A
Economics
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The structural deficit is the deficit that
a. is composed by of nondiscretionary spending by the federal government. b. results from the economy being below its natural rate of output. c. exists when output is at its natural rate of output. d. results from temporary tax cuts. e. all of the above
Economics
The period of declining growth in real GDP between the peak of the business cycle and the trough is called a(n):
A. recessionary phase. B. expansionary. C. recovery phase. D. stationary phase.
Economics