Federal government budget deficits
A. tend to increase when the economy enters a recession.
B. have tended to increase in the majority of years since 1980.
C. have caused a growing national debt.
D. have all of these characteristics.
D. have all of these characteristics.
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Many countries find it difficult to achieve economic growth. This is because economic growth
A) depends on technological change and technological change depends on noneconomic factors such as the growth rate of scientific knowledge. B) is not understood well by economists, so it is difficult to advise policy makers on the best policies to pursue. C) requires saving, and saving means less consumption today. A poor country may find it difficult to consume less today. D) appears to be predetermined and not subject to factors that policy makers can have any affect on.
If there is an increase in government spending, then, ceteris paribus, the IS curve:
A) will shift to the left. B) will shift to the right. C) will not shift at all. D) will shift to the left if there is a corresponding decrease in taxes.