The Argument That Budget Deficits Are Inflationary Is

question 147

Multiple Choice

The argument that budget deficits are inflationary is

• A)always correct.
• B)correct only when the deficit is monetized.
• C)correct only when the aggregate supply curve is horizontal.
• D)correct only when the aggregate supply curve is upward sloping.

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Definitions:

Accounts Receivable

Money owed to a company by customers for products or services that have been delivered or used but not yet paid for.

Income Tax Payable

This represents the amount of income tax that a company owes to the government but has not yet paid.

Sales

The transactions involving the exchange of goods or services for money, reflecting the primary revenue activity of a business.

Free Cash Flow

The amount of cash generated by a business after accounting for operational expenses and capital expenditures, available for distribution or reinvestment.