The Federal Budget Deficit and the Trade Balance Are Often

question 92

Multiple Choice

The federal budget deficit and the trade balance are often referred to as the

• A)balance of payments.
• B)dueling depreciators.
• C)twin deficits.
• D)national debt.

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Definitions:

Elastic

A characteristic of a product or service indicating that a change in price leads to a significant change in the quantity demanded or supplied.

Laffer Curve

An illustration of the relationship between tax rates and tax revenue, suggesting that there is an optimal tax rate that maximizes revenue.

Tax Rate Reductions

A decrease in the percentage at which income or transactions are taxed by governmental authorities.

Price Inelastic

A situation where the demand for a good or service remains relatively unchanged despite changes in its price.