A Disadvantage of Functional Finance Is That It

question 43

Multiple Choice

A disadvantage of functional finance is that it:

• A)does not focus on producing the potential level of output in an economy.
• B)increases the level of unemployment during recessions.
• C)allows chronic deficits that magnify into national debt,allowing it to reach an alarming level.
• D)requires that the budget is balanced even during times of war.
• E)magnifies fluctuations in the business cycle.

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Definitions:

Straight Salary

A compensation structure where employees are paid a fixed amount of money regularly, regardless of performance.

Commission

A form of payment to an employee or agent, typically a percentage of the value of the goods or services they have sold.

Level of Intangibility

The degree to which a product or service lacks physical substance, impacting how it is marketed and perceived by consumers.

Designer Dress

A high-fashion garment created by a renowned fashion designer or fashion house.