-Refer to the Graph Above to Answer This Question

Multiple Choice

-Refer to the graph above to answer this question.If this economy is experiencing a recessionary gap,which of the following could be correct?

A) Real GDP is Y₁ and there is a budget deficit.
B) Real GDP is Y₁ and there is a budget surplus.
C) Real GDP is Y₂ and there is a balanced budget.
D) Real GDP is Y₁ and there is a balanced budget.