Fiscal Federalism: the Size of the Public Sector Source

question 10

Multiple Choice

Fiscal Federalism: The size of the public sector Source: Office of Management and Budget,Budget of the United States Government,Fiscal Year 2017: Historical Tables (Washington,DC: U.S.Government Printing Office,2016) ,Table 14.3.
-Which of the following statements about federalism is true based on the graph?

• A)The federal government's power has grown significantly relative to the states.-Consider This: Though the federal government takes on more responsibility in times of crisis,the relationship between state and federal responsibilities has remained relatively stable.
• B)State governments are at the mercy of the federal government to secure funds.
• C)Federal and state governments carry out their own function and responsibilities.
• D)State power has supplanted federal power as dominant in the United States.

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Definitions:

Operating Loss

A situation where a business's total expenses exceed its revenues, not accounting for interest or taxes.

Year 2

Refers to the second year of a company's operation, a project, or a specific timeframe being analyzed.

Variable Costing

An accounting method that only includes variable costs—costs that change with production volume—in the calculation of product cost.

Net Operating Income

The profit a company makes after deducting operating expenses but before interest and taxes.