Measures of Public Spending in Real Terms Are Calculated

question 13

Multiple Choice

Measures of public spending in real terms are calculated:

• A) Excluding state pensions and other welfare payments
• B) In cash terms not adjusted for inflation
• C) As a share of national income
• D) In cash terms adjusted for inflation

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Definitions:

Budget Line

A budget line represents all the combinations of two goods that a consumer can purchase with a given budget, given the prices of the goods.

Leisure

Free time when one is not working or occupied; time that can be spent on relaxation or hobbies.

Utility Function

A mathematical representation used in economics to model the preference satisfaction or happiness that a consumer derives from consuming goods and services.

Fruit Farm

An agricultural establishment primarily engaged in the cultivation of fruit-bearing trees, bushes, and plants.