If the Government Were to Run a Budget Deficit and Wanted

question 21

Short Answer

If the government were to run a budget deficit and wanted to finance it by printing money, would it have the central bank conduct open market purchases or open market sales?

---

Definitions:

Unconditioned Stimulus

A stimulus that naturally triggers a response without the need for prior learning.

Unconditioned Responses

Automatic, reflexive reactions to specific stimuli that are not learned, such as jerking your hand away from a hot surface.

UCS Cortical Center

A hypothetical or proposed brain area responsible for processing unconditioned stimuli, which automatically trigger reflexive responses.

Unconditioned Response

A natural, unlearned reaction to an unconditioned stimulus, such as salivating when tasting food.