If the federal government runs a budget _______, then the national debt becomes __________.
a. surplus, larger
b. deficit, smaller
c. surplus, smaller
d. none of the above
QUESTION 2The balance of trade is the value of a nation's ____________.
a. goods and service exports times goods and service imports
b. goods exports subtracted from goods imports
c. goods imports subtracted from goods exports
d. net goods imports plus net capital inflows
QUESTION 3If Y = 500 billion, autonomous consumption = 300 billion, and the marginal propensity to save = 0.20, then saving will equal:
a. 200 billion.
b. 200 billion.
c. 100 billion.
d. 100 billion.
e. 40 billion.
QUESTION 4If the national debt rises to the debt ceiling and there is currently a budget ________, the Congress and the President must agree to ________ the debt ceiling or else the federal government will have insufficient funds to pay its bills and will be forced to shut down.
a. surplus, lower
b. deficit, raise
c. surplus, lower
d. none of the above
QUESTION 5The North American Free Trade Agreement affects trade between:
a. the United States, Cuba, and Brazil.
b. the United States, Canada, and Mexico.
c. the United States, Puerto Rico, and Cuba.
d. Brazil, Bolivia, Peru, and Columbia.
e. China and the United States.
QUESTION 6If Y = 500 billion, autonomous consumption = 400 billion, and the marginal propensity to save = 0.20, then saving will equal:
a. 300 billion.
b. 300 billion.
c. 0.
d. 80 billion.
e. 80 billion.
QUESTION 7Which of the following correctly describes the national debt?
a. The excess of annual federal expenditures over annual federal tax revenues.
b. Annual federal expenditures less annual federal tax revenues plus foreign U.S. bonds purchases.
c. The total amount of money owed by the federal government.
d. None of the above.
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