Question

Over the long​ run, the fundamental funding sources for the government are

A. borrowing.

B. lending.

C. taxes.

D. transfer​ payments, and borrowing.

Social Security taxes are

A. progressive because all workers pay the tax.

B. regressive because higher income workers​ don't pay the tax.

C. regressive because higher income workers pay taxes on a smaller percentage of their income.

D. proportional because everyone is charged the same percentage tax rate.

Suppose the economy is initially experiencing a recessionary gap.  

A reduction in the size of the budget deficit will cause which of the following in the short​ run?

A. a reduction in the size of the recessionary gap and increase in real GDP.

B. an inflationary gap.

C. an increase in the size of the recessionary gap and decrease in real GDP.

D. an increase in inflation and increase in aggregate supply.

Since​ 1940, the U.S. government has experienced

A. about the same number of years with budget deficits as with budget surpluses.

B. twice as many annual budget surpluses as annual budget deficits.

C. many more budget deficits than budget surpluses.

D. only one year with a budget surplus.

Answer 1

• 1) C. Taxes.

which also includes,

• User charges
• Borrowing

• 2) C. Regressive because higher income workers pay taxes on s smaller percentage of their income.

• 3) C. An increase in the size of the recessionary gap and decrease in real GDP.

• 4) C. Many more budget deficits than budget surpluses.