Consider the Government's Budget Balance

question 60

Multiple Choice

Consider the government's budget balance.Suppose G = 500 and the government's net tax revenue is equal to 0.25Y.When Y = 2920,the government is running a budget

• A)deficit of 730.
• B)surplus of 230.
• C)balance.
• D)deficit of 230.
• E)surplus of 730.

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Definitions:

Annually

Occurring once every year or relating to a period of one year.

RRSP

Registered Retirement Savings Plan, a Canadian investment account designed to save for retirement, offering tax benefits.

Compounded

The process where interest is calculated on the initial principal and also on the accumulated interest of previous periods of a deposit or loan.

Annually

Annually means occurring once every year or pertaining to a period of one year.