Which of the Following Is True of an Increase in a Federal

question 70

Multiple Choice

Which of the following is true of an increase in a federal government budget surplus?

• A)When the surplus increases,revenues rise less than expenditures.
• B)The aggregate demand curve shifts rightward as a result of an increasing surplus.
• C)The unemployment rate falls as a result of an increasing surplus.
• D)Such an increase in the surplus might close an expansionary gap.
• E)The natural rate of unemployment increases as a result of an increasing surplus.

---

Definitions:

Capitalism

Capitalism is an economic system characterized by private ownership of the means of production, profit-driven enterprise, and the market mechanism of supply and demand determining production and investment.

Economic Relations

Refers to the interactions and transactions among individuals, businesses, and governments concerning the production, distribution, and consumption of goods and services.

Capitalist System

An economic system where trade, industry, and the means of production are largely or entirely privately owned and operated for profit.

Social Relations

The interactions and connections among individuals within a society, shaping each other's behaviors, attitudes, and social structures.