Those Who Are Concerned About Balanced Budget Amendments Typically Argue

question 40

Multiple Choice

Those who are concerned about balanced budget amendments typically argue that:

• A) they would make fluctuations in output around the natural level of output greater.
• B) they would reduce national saving.
• C) they would cause interest rates to be higher than they otherwise would be.
• D) they would reduce aggregate demand.
• E) they would increase spending in a recession.

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Definitions:

Industrialized Nations

Countries that are characterized by a high level of industrialization, advanced technological infrastructure, and higher living standards.

Labor Productivity

The measure of the amount of goods and services produced by one hour of labor.

Worker Hour

A measure of labor that represents one hour of work performed by an employee or a group of employees.

Gross Savings Rate

The percentage of gross national income saved by a country's residents.