Which of the Following Best Describes Most Economists' Approach to Economic

question 62

Multiple Choice

Which of the following best describes most economists' approach to economic stabilization until the 1930s?

• A)Maintain a balanced budget at all times, under the principle of sound finance.
• B)Use a sound finance approach during normal economic times, and a functional finance approach during a recession or a boom.
• C)Run larger deficits during recessions and smaller deficits during economic booms, counting on economic growth to be high enough to keep the debt-to-GDP ratio low.
• D)Economists were wholly concerned with microeconomics and had ignored problems of government deficits, debt, recessions, and economic growth.

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Definitions:

Sales-Type Lease

A lease agreement where the lessor recognizes immediate profit similar to a sale, often used in the context of finance leases in accounting.

Unearned Interest: Leases

Interest that has been collected on a lease but not yet earned, often because the period it covers has not fully elapsed.

Present Value Factors

Numeric factors used in calculating the present value of future cash flows, reflecting the time value of money.

Interest Revenue

Income earned from investments in interest-bearing assets like bonds, loans, and savings accounts.