Based on a Few Students Whom You Know, You Decide

question 40

True/False

Based on a few students whom you know, you decide that art majors wear funky clothes and that physics majors tend to be nerds. This is an example of inductive reasoning.

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Definitions:

Functional Finance

A budget philosophy using fiscal policy to achieve the economy’s potential GDP, rather than balancing budgets either annually or over the business cycle.

Chronic Deficits

Persistent shortfalls where expenditures exceed revenues over a long period, often leading to increased public debt.

National Debt

The total amount of money that a country's government has borrowed.

Automatic Stabilizers

Economic policies and programs, such as unemployment insurance and taxation, that automatically adjust to help stabilize an economy during fluctuations.