The Size of the Structural Deficit Tells Us

question 64

Multiple Choice

The size of the structural deficit tells us

• A) what increase to expect in the actual deficit over the next fiscal period.
• B) what relative impact current fiscal policy is having on the economy.
• C) what size tax increase is needed to balance the budget.
• D) the best way to finance the current deficit.
• E) how much of the budget should be financed by borrowing and how much by raising taxes.

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Definitions:

Normally Distributed

A data distribution that is symmetric about the mean, showing that data near the mean are more frequent in occurrence than data far from the mean.

Sampling Distribution

A probability distribution of a statistic obtained through a large number of samples drawn from a specific population.

Bell Shaped

Describes a distribution that is symmetrical and peaked in the middle, resembling the shape of a bell, often referring to the normal distribution.

Sampling Distribution

Likelihood patterns of a specific statistic that are based on randomly chosen samples.