At the End of 2003, the Government Had a Debt

question 10

Multiple Choice

At the end of 2003, the government had a debt of about $3,924 billion. During 2004, real GDP grew by about 4.2 percent and inflation was about 2.6 percent. About what is the largest deficit the government could have run without raising the debt-to-GDP ratio?

• A)About $63 billion.
• B)About $165 billion.
• C)About $267 billion.
• D)About $429 billion.

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Definitions:

Negative Reinforcement

A behavioral principle where the removal or avoidance of an undesirable outcome strengthens the behavior leading to its avoidance.

Punishment

The application of an aversive stimulus following a response in an effort to decrease the likelihood that the response will recur.

Positive Reinforcement

A method in behavioral psychology where the introduction of a rewarding stimulus following a desired behavior increases the likelihood of its recurrence.

Operant-Conditioning

A method of learning in which behavior strength is altered via rewards or penalties.