Budget Deficits Almost Always

question 100

Multiple Choice

Budget deficits almost always:

• A)decrease with inflation and increase with deflation.
• B)increase when unemployment increases and fall when unemployment falls.
• C)decrease when unemployment increases and increase when unemployment falls.
• D)increase when the aggregate price level increases and fall when the aggregate price level falls.

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Definitions:

Trade Restrictions

Measures such as tariffs, quotas, and embargoes imposed by governments to control and limit the volume or value of goods and services that are traded across borders.

Innovation

The process of creating new methods, ideas, or products, or the introduction of something new that adds value.

Declining Industries Argument

The notion that certain sectors of the economy may experience a reduction in demand and productivity, leading to a downturn in those industries.

Foreign Competition

The competition that domestic companies face from companies located in other countries.