Economists Tend to Be Critical of Any Balanced Budget Legislation

question 11

Multiple Choice

Economists tend to be critical of any balanced budget legislation that would force governments to override automatic stabilizers and __________ spending or __________ taxes in recessions to avoid deficits.

• A) increase;decrease
• B) increase;increase
• C) decrease;decrease
• D) decrease;increase
• E) increase;not change

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Definitions:

Average Total Cost

The total cost of production divided by the quantity of output produced, showing the average cost per unit.

Technological Advance

Progress in technology that often leads to improvements in efficiency, productivity, and the development of new products.

Venture Capital

Financing that investors provide to startup companies and small businesses that are believed to have long-term growth potential.

Retained Earnings

Profits that a company keeps or reinvests after dividends are paid out to shareholders, often used for research, development, debt reduction, or other investments.