Naked Economics: Undressing the Dismal Science Book by Charles Wheelan This question is based on the section of "Keeping Score" in Wheelan's Naked Economics, where the author discusses budget deficits and surpluses. Which of the below statements is INCORRECT? A) If an economy slips into a recession, tax revenues will fall, but raising taxes will certainly worsen the situation. B) A budget deficit occurs when the government spends more than it collects in tax revenues. C) An economy should steer clear of deficit budgets even during economic recessions. D) A budget deficit is funded by borrowing money by selling treasury bonds, which requires the government to pay back the interest on the amount borrowed, plus the principal borrowed. E) Since 2001 the U.S. has been consistently spending more than the tax revenue it collected, and the amount borrowed plus interest owed has been accummulating to a rather large national debt.
Naked Economics: Undressing the Dismal Science Book by Charles Wheelan This question is based on the section of "Keeping Score" in Wheelan's Naked Economics, where the author discusses budget deficits and surpluses. Which of the below statements is INCORRECT? A) If an economy slips into a recession, tax revenues will fall, but raising taxes will certainly worsen the situation. B) A budget deficit occurs when the government spends more than it collects in tax revenues. C) An economy should steer clear of deficit budgets even during economic recessions. D) A budget deficit is funded by borrowing money by selling treasury bonds, which requires the government to pay back the interest on the amount borrowed, plus the principal borrowed. E) Since 2001 the U.S. has been consistently spending more than the tax revenue it collected, and the amount borrowed plus interest owed has been accummulating to a rather large national debt.
Chapter19: Public Choice And Special Interest Group Politics
Section: Chapter Questions
Problem 11QP
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Naked Economics: Undressing the Dismal Science Book by Charles Wheelan
This question is based on the section of "Keeping Score" in Wheelan's Naked Economics, where the author discusses budget deficits and surpluses. Which of the below statements is INCORRECT?
A) If an economy slips into a recession, tax revenues will fall, but raising taxes will certainly worsen the situation.
B) A budget deficit occurs when the government spends more than it collects in tax revenues.
C) An economy should steer clear of deficit budgets even during economic recessions.
D) A budget deficit is funded by borrowing money by selling treasury bonds, which requires the government to pay back the interest on the amount borrowed, plus the principal borrowed.
E) Since 2001 the U.S. has been consistently spending more than the tax revenue it collected, and the amount borrowed plus interest owed has been accummulating to a rather large national debt.
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