If the Federal Budget Is Initially Balanced and Government Expenditures

Multiple Choice

If the federal budget is initially balanced and government expenditures remain constant, then an
Increase in GDP will _________ tax revenues and create a budget _________.

A) increase tax revenues and create a budget surplus.
B) increase tax revenues and create a budget deficit.
C) decrease tax revenues and create a budget surplus.
D) decrease tax revenues and create a budget deficit.