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Firdavs [7]
3 years ago
11

Potential GDP of​ $12 trillion and if real GDP equaled potential​ GDP, the budget deficit would be​ $1 trillion.

Business
1 answer:
Karo-lina-s [1.5K]3 years ago
8 0

Answer:

D. deficit of​ $1 trillion; surplus of​ $4 trillion

Explanation:

If the economy reaches their potential at 12 trillion the government would run a deficit of 1 trilllon which means there is an structural deficit of 1 trillion

As currently there is a surplus of 3 trillion This mean the economy is in a cycle under which there is a surplus of 4 trillion

current budget - structural budget = cyclical

3  - (-1) = 3 + 1 = 4

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