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    Economics Principles and Policy Study Set 2
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    Exam 32: Budget Deficits in the Short and Long Run
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    Conventional Budget Accounting Practices Tend to Overstate Deficits in Inflationary
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Conventional Budget Accounting Practices Tend to Overstate Deficits in Inflationary

Question 171

Question 171

Multiple Choice

Conventional budget accounting practices tend to overstate deficits in inflationary periods because they


A) ignore the inflation tax.
B) confuse repayment of principal with real interest expenditures.
C) double count some expenditures.
D) understate real interest rates.

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