In the long-run framework, budget surpluses: Choose the Correct and Explain why its correctshould be run whenever output dips below potential output.should never be run since they crowd out investment in the short run.are better than budget deficits over the long run because unlike budget deficits, they increase saving and investment.should be run on a permanent basis since they boost saving and investment and stimulate economic growth.

When the income tends to exceed the expenditures of an economy, there is an occurrence of budget…

Answered: In the long-run framework, budget…

MACROECONOMICS FOR TODAY

10th Edition

ISBN:9781337613057

Author:Tucker

Publisher:Tucker

Chapter13: Federal Deficits, Surpluses, And The National Debt

Section: Chapter Questions

Problem 20SQ

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In the long-run framework, budget surpluses: Choose the Correct and Explain why its correct

should be run whenever output dips below potential output.
should never be run since they crowd out investment in the short run.
are better than budget deficits over the long run because unlike budget deficits, they increase saving and investment.
should be run on a permanent basis since they boost saving and investment and stimulate economic growth.

Definition Definition Increase in the amount of goods and services produced by a country in a given period of time compared to an earlier period. Economic growth is generally coupled with a rise in national income or the purchasing power of individuals. It is often measured in terms of the increase in a country's gross domestic product (GDP), or the overall monetary value of all the complete or final services and goods that a country can produce within its domestic boundaries in a specific period.

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