In Examining the National Income Accounts of the Closed Economy

Multiple Choice

In examining the national income accounts of the closed economy of Nepotocracy, you see that it in 2007 it had taxes of $100 billion, transfers of $40 billion, and government purchases of goods and services of $80 billion. You also notice that in 2006 it had private saving of $50 billion and investment of $70 billion. In which year did Nepotocracy have a budget deficit of $20 billion?

A) 2007 and 2006
B) 2007 but not 2006
C) 2006 but not 2007
D) neither 2006 nor 2007