Which of the Following Is True Regarding Government Expenditures in the United

question 188

Multiple Choice

Which of the following is true regarding government expenditures in the United States?

• A) As a share of GDP, government expenditures were higher in 1950 than 2010.
• B) Government expenditures were more than 30 percent of GDP in 1930.
• C) Government expenditures as a share of GDP grew rapidly between 1930 and 1980.
• D) In 2010, government expenditures at all levels summed to approximately 10 percent of GDP.

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Definitions:

Crowding-In Effect

An economic theory suggesting that increased government spending leads to an increase in private sector investment.

Government Spending

Expenditures made by the government sector including spending on goods and services, public projects, and transfer payments.

Economic Expansion

A phase in the business cycle where the economy grows and increases in activity.

Budget Deficits

Occurs when a government's expenditures surpass its revenues during a given period, leading to borrowing or use of saved funds.