Suppose That U

question 177

Multiple Choice

Suppose that U.S. debt is $7 trillion at the beginning of the fiscal year. During the fiscal year, its purchases of goods and services and its transfers are $2 trillion, and tax revenues are $1.5 trillion. At the end of the fiscal year, the debt is:

• A)$10.5 trillion.
• B)$6.5 trillion.
• C)$9 trillion.
• D)$7.5 trillion.

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Definitions:

Comparative Advantage

The ability of an entity to produce a good or service at a lower opportunity cost than its competitors.

Televisions

Electronic devices designed for the reception and display of audiovisual content transmitted over airwaves or through cable systems.

Comparative Advantage

The ability of an individual, company, or country to produce a good or service at a lower opportunity cost than competitors, enabling more efficient trade.

Opportunity Cost

Forgoing potential profits from various options by deciding on a specific alternative.