What Effect Would Economic Weakness in Europe Due to a Sovereign

question 45

Multiple Choice

What effect would economic weakness in Europe due to a sovereign debt crisis have on the U.S. economy?

• A)IS shifts to the right
• B)IS shifts to the left
• C)potential GDP increases
• D)potential GDP decreases

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Definitions:

Nondeductible Contributions

Contributions made to certain retirement accounts that do not qualify for a tax deduction at the time of deposit.

Taxable Portion

This is the part of any income or financial gain that is subject to taxation according to current tax laws.

Traditional IRA

An individual retirement account allowing individuals to direct pre-tax income towards investments that can grow tax-deferred until retirement withdrawals.

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The required minimum amount that must be withdrawn annually from retirement accounts after reaching a certain age.