If the Government Wants to Close a GDP Gap, It

question 51

Multiple Choice

If the government wants to close a GDP gap, it should:

• A)borrow funds from the public by issuing bonds.
• B)lower taxes and raise government spending.
• C)lower government spending on social security.
• D)raise both direct and indirect tax rates.
• E)adopt contractionary fiscal policies to control inflation.

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Definitions:

Accounting Period

A specific period of time used for financial reporting purposes, usually a quarter or a year, to measure business activities and prepare financial statements.

Trial Balance

A bookkeeping report that lists the balances of all ledgers in two columns, debits and credits, ensuring that total debits match total credits.

Chart of Accounts

A systematic listing of all accounts used by an organization, categorized to facilitate financial reporting and bookkeeping.

GAAP

Generally Accepted Accounting Principles, the standard framework of guidelines for financial accounting in the U.S.