Chapter 16, Problem 6AA

To determine

To ascertain the letter of the term that best completes each sentence, “A natural disaster is an example of something that would _______ emergency spending.”

Explanation of Solution

A natural disaster is an example of something that would exceed emergency spending.

Natural disasters trigger major budgetary stresses, with both limited short-term fiscal impacts and wider long-term consequences for growth. Reallocation is the primary fiscal response to a catastrophe. Natural disasters damage productive assets such as buildings and equipment and human resources and thereby deteriorate their potential for production So, the answer is exceed.

Economics Concept Introduction

Introduction: A natural disaster is an occurrence caused by the Earth's natural forces in which considerable harm occurs, and often loss of life. Natural disasters can take many forms including earthquakes and tsunamis, flooding and volcanic eruptions, mudslides and wildfires.