When the economy is at full employment,

a) the actual and the cyclically adjusted budgets will be equal.

b) the cyclically adjusted budget will show a surplus and the actual budget will show a deficit.

c) the actual budget will show a surplus and the cyclically adjusted budget will show a deficit.

d) one cannot generalize in comparing the actual and the cyclically adjusted budgets."

Question

Business

Mariela Ewing

28 January, 15:03

When the economy is at full employment,

a) the actual and the cyclically adjusted budgets will be equal.

b) the cyclically adjusted budget will show a surplus and the actual budget will show a deficit.

c) the actual budget will show a surplus and the cyclically adjusted budget will show a deficit.

d) one cannot generalize in comparing the actual and the cyclically adjusted budgets."

+4

Answers (1)

Know the Answer?

Amelia Kelly · Answer 1

The correct answer is (A)

Explanation:

The actual and cyclically balanced spending plans will be equivalent when the economy is at full work (full employment level). The cyclically adjusted budget estimates what the Federal spending shortage or surplus would be at full employment level with existing duty and spending choices.