The Cyclically Adjusted Budget Tells Us

question 197

Multiple Choice

The cyclically adjusted budget tells us

• A)that in a full-employment economy, the federal budget should be in balance.
• B)that tax revenues should vary inversely with GDP.
• C)what the size of the federal budget deficit or surplus would be if the economy was at full employment.
• D)the actual budget deficit or surplus realized in any given year.

---

Definitions:

Discretionary Income

The money that remains after paying for taxes and necessities.

Disposable Income

The money a consumer has left after paying taxes to use for necessities such as food, housing, clothing, and transportation.

Market Segmentation

The strategy of dividing a broad target market into subsets of consumers with common needs or characteristics, targeting each with a specific marketing mix.

Organizational Markets

Markets consisting of companies, governments, and institutions that purchase goods and services for operations, production, or resale purposes.