The Cyclically Adjusted Deficit as a Percentage of GDP Is

Multiple Choice

The cyclically adjusted deficit as a percentage of GDP is 2 percent in Year 1.This cyclically adjusted deficit becomes 1 percent of GDP in Year 2.It can be concluded that from Year 1 to Year 2,

A) fiscal policy was more expansionary.
B) fiscal policy was more contractionary.
C) the Federal government is decreasing taxes.
D) the Federal government is increasing spending.