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- What is likely to happen to a country's budget deficit if the government increases spending without raising taxes during a period of economic stagnation? A. The budget deficit will decrease because government spending will stimulate economic growth. B. The budget deficit will increase because government spending exceeds tax revenue. C. The budget deficit will remain unchanged because the increase in government spending is offset by increased tax revenue from stimulated economic activity. D. The budget deficit will turn into a budget surplus because increased government spending always leads to higher tax revenues in the long run.When a government runs a deficit, it _________ a. It cuts fundings for defense and uses the money to other government services. b. It shuts the government down. c. It borrows from the public through the financial system to increase its spending. d. It reallocates money from departments that have excesses to departments that have deficits.if us decides to cover the budget deficit through money creation, what are the impacts?
- Due to Corona Virus epidemic in Bangladesh, Government tax collection has declined, but government’s expenditure did not, creating budget deficit. What are the ways government can finance the budget deficit? Do you think financing budget deficit will create inflation? Explain in detailsIs it a good policy for the government to create budget deficit?The U.S. government funds deficit spending by: a. issuing bonds b. decreasing taxes. c. redeeming bonds. d. increasing taxes e. selling government services.
- Suppose there is an increase in budget deficit, what happens to intrest rates and national savings ?The U.S. government funds deficit spending by: A. selling government services. B. decreasing taxes. C. redeeming bonds. D. issuing bonds E.increasing taxesWould you please explain carefully several financial sources how the government financing its expenditure and the policy in order to close its deficit?
- As long as tax rates are not very high, a decrease in tax rates will tend to a. increase the budget deficit b. decrease the budget deficit c. leave the budget deficit unchanged d. cause the budget deficit to first decrease then increasewhat are the conventional and unconverntional ways to reduce a deficit and what are the related problems that could arise with these measures?What is the best combination of fiscal policies and monetary policies for a country like Japan whose price levels are increasing while unemployment is being controlled? a. Decrease taxes, increase government spending and increase money supply b. Decrease taxes, decrease government spending and decrease money supply c. None of these choice is correct d. Increase taxes, decrease government spending and decrease money supply