Figure 10.4 Federal Surplus or Deficit as a Percent of GDP
What will be an ideal response?
The federal deficit—as measured by government borrowing—reached 6 percent of GDP in 1983, a year of deep recession. The deficit was reduced as a percent of GDP from the early 1990s until 1998, when the budget went into surplus. From 1998 to 2001, the government had a net surplus, meaning that some debt was being retired. After 2000, a recession combined with the Bush administration tax cuts put the budget back into deficit. The recession of 2007-9 led to even larger deficits, reaching 10% of GDP before starting to decline as the economy started a slow recovery
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Why did the EU countries move away from the EMS toward the goal of a single shared currency?
What will be an ideal response?
The burden of a tax will fall primarily on buyers when the
a. demand for the product is highly inelastic and the supply is relatively elastic. b. demand for the product is highly elastic and the supply is relatively inelastic. c. tax is legally (statutorily) imposed on the seller of the product. d. tax is legally (statutorily) imposed on the buyer of the product.