Asked by Raymond Shaquille on May 11, 2024
Verified
If G = $800 billion,tax receipts = $850 billion,and there is an inflationary gap of $100 billion,there is
A) a budget surplus.
B) a budget deficit.
C) not enough information to determine whether there is a budget surplus or a budget deficit.
Inflationary Gap
The difference between the actual level of output in an economy and the output level needed to achieve full employment without inflation.
Budget Surplus
A situation where income or revenues exceed expenditures over a specified period of time.
- Recognize the association among the national debt, federal budgetary practices, and economic measures.
- Familiarize yourself with the ideas of budget deficits and surpluses, including their eventual consequences.
Verified Answer
SD
STEVEN DJAJAMay 12, 2024
Final Answer :
A
Explanation :
A budget surplus occurs when tax receipts exceed government spending. In this case, tax receipts are $850 billion and government spending (G) is $800 billion, indicating a budget surplus. The inflationary gap does not directly affect the determination of a budget surplus or deficit.
Learning Objectives
- Recognize the association among the national debt, federal budgetary practices, and economic measures.
- Familiarize yourself with the ideas of budget deficits and surpluses, including their eventual consequences.
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