In Comparison to a Government That Runs a Balanced Budget

question 134

Multiple Choice

In comparison to a government that runs a balanced budget, when the government runs a budget deficit,

• A)the equilibrium interest rate will fall.
• B)business investment will fall.
• C)household savings will fall.
• D)the demand for loanable funds will shift to the right.
• E)none of the above

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Definitions:

Racing Heart

A rapid heartbeat that can be felt by the individual, often a symptom of anxiety, fear, exercise, or medical conditions.

Schachter's Concept

Refers to the idea that emotion results from cognitive appraisal of both physiological arousal and situational cues.

Bodily Arousal

The physiological and psychological state of being awoken or stimulated, often associated with emotion, stress, or excitement.

Emotion

A complex psychological state involving three distinct components: a subjective experience, a physiological response, and a behavioral or expressive response.