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The Diagram Below Shows Two Budget Deficit Functions for a Hypothetical

Question 42

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The diagram below shows two budget deficit functions for a hypothetical economy. The diagram below shows two budget deficit functions for a hypothetical economy. FIGURE 31-2 Refer to Figure 31-2.Initially,suppose the economy is at point A on budget deficit function .Real GDP (Y) is $100 million.If the government implements a fiscal policy that causes the budget deficit function to shift to ,we can conclude that the policy was ________ and the structural deficit will be ________ than previously. A) expansionary; smaller B) expansionary; larger C) contractionary; larger D) contractionary; smaller FIGURE 31-2 Refer to Figure 31-2.Initially,suppose the economy is at point A on budget deficit function The diagram below shows two budget deficit functions for a hypothetical economy. FIGURE 31-2 Refer to Figure 31-2.Initially,suppose the economy is at point A on budget deficit function .Real GDP (Y) is $100 million.If the government implements a fiscal policy that causes the budget deficit function to shift to ,we can conclude that the policy was ________ and the structural deficit will be ________ than previously. A) expansionary; smaller B) expansionary; larger C) contractionary; larger D) contractionary; smaller .Real GDP (Y) is $100 million.If the government implements a fiscal policy that causes the budget deficit function to shift to The diagram below shows two budget deficit functions for a hypothetical economy. FIGURE 31-2 Refer to Figure 31-2.Initially,suppose the economy is at point A on budget deficit function .Real GDP (Y) is $100 million.If the government implements a fiscal policy that causes the budget deficit function to shift to ,we can conclude that the policy was ________ and the structural deficit will be ________ than previously. A) expansionary; smaller B) expansionary; larger C) contractionary; larger D) contractionary; smaller ,we can conclude that the policy was ________ and the structural deficit will be ________ than previously.


A) expansionary; smaller
B) expansionary; larger
C) contractionary; larger
D) contractionary; smaller

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