Exam 33: Budget Deficits in the Short and Long Run

The remarkable fact about the structural deficit after 1983 was that it was

The structural deficit can be defined as

Under a balanced budget policy, a sharp rise in GDP will cause

Between the years of 2001 and 2003, what happened to the structural deficit?

Japanese Prime Minister Ryutaro Hashimoto was called the "Herbert Hoover of Japan" because he

What does it mean to "monetize the deficit"? Why is it important in discussions of fiscal policy? Use an appropriate diagram to illustrate your answer.

The government should not attempt to balance the budget if

If the Fed decides to keep interest rates low when there is a large budget deficit, economists conclude that the Fed is

If the economy is in an inflationary gap, which of the following is the least appropriate policy mix?

The principal difference between conventional accounting and economic analysis of inflation is that

The national debt is the

What is "crowding out"? Why is it important in discussions of fiscal policy? Use an appropriate diagram to illustrate your answer.

The crowding-out effect is likely to be the strongest during periods of

Suppose that the economy is currently at full employment.All other things being equal, if central bank implements contractionary policy, then the appropriate fiscal policy is to

The Troubled Asset Relief Program (TARP) totaled ____ and the fiscal stimulus package of 2009 totaled ____.

The structural deficit is defined as

A recessionary gap causes national debt to increase because

In 2010 and 2011, President Obama advocated deficit reduction through decreased spending while Republicans in Congress advocated increased taxation to achieve the same goal.

Whether or not deficits create a burden depends on how and why the government incurred the deficits in the first place.Explain.

If a balanced budget were required in 2008, the government would have been required to cut spending and increase taxes.