When the unemployment rate increases, the budget: a. is unaffected b. tends to move into deficit c. tends to move into a surplus d. remains neutral If government purchases decrease so the budget may be balanced, some government transfers will automatically increase, reducing the multiplier effect. True False
When the unemployment rate increases, the budget: a. is unaffected b. tends to move into deficit c. tends to move into a surplus d. remains neutral If government purchases decrease so the budget may be balanced, some government transfers will automatically increase, reducing the multiplier effect. True False
Chapter24: Fiscal Policy
Section: Chapter Questions
Problem 3P
Related questions
Question
100%
When the unemployment rate increases, the budget:
a. is unaffected
b. tends to move into deficit
c. tends to move into a surplus
d. remains neutral
If government purchases decrease so the budget may be balanced, some government transfers will automatically increase, reducing the multiplier effect.
True
False
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Exploring Economics
Economics
ISBN:
9781544336329
Author:
Robert L. Sexton
Publisher:
SAGE Publications, Inc
Exploring Economics
Economics
ISBN:
9781544336329
Author:
Robert L. Sexton
Publisher:
SAGE Publications, Inc