Suppose potential GDP is $20 trillion. If the economy produces at potential, then the government budget deficit is $1 trillion. If actual GDP is $19 trillion, the government deficit is $1.25 trillion. The cyclically adjusted budget deficit is trillion (do not enter a '$' sign)

Suppose potential GDP is $20 trillion. If the economy produces at potential, then the government budget deficit is $1 trillion. If actual GDP is $19 trillion, the government deficit is $1.25 trillion. The cyclically adjusted budget deficit is trillion (do not enter a '$' sign)

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter30: Government Budgets And Fiscal Policy

Section: Chapter Questions

Problem 51P: A government starts off with a total debt of $3.5 billion. In year one, the government runs a...

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Question

Suppose potential GDP is $20 trillion. If the economy
produces at potential, then the government budget deficit is
$1 trillion. If actual GDP is $19 trillion, the government
deficit is $1.25 trillion. The cyclically adjusted budget deficit
is
trillion (do not enter a '$' sign)

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