An Attempt to Maintain an Annually Balanced Budget Would

question 19

Multiple Choice

An attempt to maintain an annually balanced budget would

• A)destabilize the economy.
• B)cause output to remain at the full-employment level of real GDP.
• C)stabilize the economy if investment is unaffected by changes in government spending;otherwise the economy will tend to be destabilized.
• D)stabilize the economy.
• E)have no effect on the level of,or the fluctuations in,real GDP.

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Definitions:

Lawyer's Fees

Costs incurred for legal services provided by attorneys.

Amortized

The gradual write-off of the initial cost of an asset or liability over a period, typically through regular payments or charges against earnings.

Intangible Asset

A non-physical asset possessing value, such as patents, trademarks, copyrights, and goodwill.

Fair Value

The estimated price at which an asset or liability could be traded in a fair transaction between willing parties, other than in a forced or liquidation sale.