Which of the Following Is Not an Argument in Favor

question 14

Multiple Choice

Which of the following is not an argument in favor of requiring the government to balance its budget?

• A)Government debt imposes higher taxes or more borrowing on future generations.
• B)A balanced budget will smooth the business cycle.
• C)Deficits lower national saving.
• D)Recent history shows that Congress will run deficits even when deficits are not justified by war or recession.

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Definitions:

Fixed Costs

Regularly occurring costs that remain constant in total, irrespective of changes in operational levels or volume of output.

Variable Costs

Costs that change in direct proportion with the level of output or activity of a business.

Underapplied Overhead

occurs when the allocated manufacturing overhead cost is less than the actual overhead incurred, leading to a discrepancy.

Overapplied Overhead

A situation where the allocated manufacturing overhead costs exceed the actual overhead costs incurred.