With the Expenditures Programs and the Tax System Shown in the Above

Multiple Choice

With the expenditures programs and the tax system shown in the above diagram:

A) the public budget will be expansionary at all GDP levels above K, and contractionary at all GDP levels below K.
B) the public budget will be a destabilizing force at all levels of GDP.
C) deficits will be realized at income levels below K, and surpluses above K.
D) deficits will be realized at income levels below H, and surpluses above H.