If the Deficit Is 0

question 51

Multiple Choice

If the deficit is 0.08 times GDP,the existing debt-GDP ratio is 0.8,and the growth rate of nominal GDP is 0.05,then the change in the debt-GDP ratio is

• A)+0.08
• B)+0.04.
• C)0)
• D)-0.08.

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Definitions:

Closing Entries

Journal entries made at the end of an accounting period to transfer the balances of temporary accounts to permanent ones, thereby preparing the books for the next period.

Income Summary

An account used in the closing process during the accounting cycle that summarizes revenues and expenses before transferring the net income or loss to retained earnings.

Owner's Capital

The total value of assets contributed by the owner(s) to a business minus any withdrawals made by the owner(s).

Correcting Entry

An accounting entry made to correct errors found in the financial statements after they have been prepared.