To Evaluate the Size of the Federal Budget Deficit or Surplus

question 212

Multiple Choice

To evaluate the size of the federal budget deficit or surplus over time,it would be best to look at the

• A)absolute size of the budget deficit or surplus.
• B)budget deficit or surplus as a percentage of GDP.
• C)budget deficit or surplus as a percentage of tax revenues.
• D)budget deficit or surplus as a percentage of government spending.

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Definitions:

Industry

A sector of the economy that involves the production and manufacturing of goods or the provision of services.

Long Run

A period during which all factors of production and costs are variable, in contrast with the short run where some costs are fixed.

Short Run

A period in economics during which at least one input, such as plant and equipment, is fixed, focusing on immediate effects of economic decisions.

Marginal Revenue

The additional income generated from the sale of one more unit of a product or service.