After Running the Numbers on a New Green Job Plan

question 10

Multiple Choice

After running the numbers on a new Green Job plan, the CBO projects that the government _______ will increase by $40 billion each year, and _______ will increase $400 billion over the project's lifespan.

• A) debt; the deficit
• B) debt; transfer payments
• C) deficit; debt
• D) deficit; transfer payments

---

Definitions:

Isoelastic Demand Curve

Demand curve with a constant price elasticity.

Price Elasticity

The measure of how much the quantity demanded of a good responds to a change in the price of that good, often used to understand the sensitivity of consumers to price changes.

Income Elasticity

Income elasticity measures how the demand for a good or service changes in response to changes in consumer income.

Marginal Utility

The extra pleasure or benefit gained by a consumer from consuming an additional unit of a product or service.