If the Budget Deficit Is $50 Billion and the Structural

question 64

Multiple Choice

If the budget deficit is $50 billion and the structural deficit is $10 billion, the cyclical deficit is

• A) $40 billion.
• B) More information is needed to answer the question.
• C) $50 billion.
• D) $60 billion.
• E) $10 billion.

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Definitions:

Interest Rates

The cost of borrowing money or the reward for saving, usually expressed as a percentage of the principal amount annually.

Balloon Note

A type of loan that has a large or "balloon" payment due upon maturity, typically after a series of lower regular payments.

Maturity

The final payment date of a loan or financial instrument at which point the principal (and all remaining interest) is due to be paid.

Covenants

Agreements or promises in a formal loan or bond agreement that cover certain conditions, actions, or restrictions taken by the borrower.