Economics 9708 · AS & A Level · Fiscal policy

Fiscal policy — practice question

Which set of conditions is most likely to cause a country’s budget deficit to rise?

  • Atotal GDP decreases; unemployment rises; discretionary government spending decreases
  • Btotal GDP decreases; unemployment rises; discretionary government spending no change
  • Ctotal GDP increases; unemployment falls; discretionary government spending increases
  • Dtotal GDP increases; unemployment falls; discretionary government spending no change

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