If There Is Initially a Federal Budget Surplus, and Government

question 110

Multiple Choice

If there is initially a federal budget surplus, and government purchases and taxes both rise:

• A)AD increases and the budget surplus increases.
• B)AD increases and the budget surplus decreases.
• C)AD decreases and the budget surplus increases.
• D)AD decreases and the budget surplus decreases.
• E)there is an indeterminate effect on both AD and the budget surplus.