In the long run, a higher government deficit does NOT affect equilibrium real Gross Domestic Product (GDP), so that continuous increases in the government deficit will
A. reduce the price level.
B. lead to greater tax revenues.
C. increase the unemployment rate.
D. reduce spending on privately provided goods and services.
Answer: D
Economics
You might also like to view...
An example of capital is:
A) cash. B) a factory building. C) money in a checking account. D) the existing state of technology.
Economics
If the Federal Reserve decreases the money supply, then initially there is a
a. shortage in the money market, so people will want to sell bonds. b. shortage in the money market, so people will want to buy bonds. c. surplus in the money market, so people will want to sell bonds. d. surplus in the money market, so people will want to buy bonds.
Economics