The table below shows the relationship between the deficit and real GDP.Draw a diagram depicting this relationship.Assume potential GDP is $6,900 billion.
(A)What is the structural deficit? (
B)If real GDP is $7,050 billion,what is the cyclical deficit? (
C)If real GDP is $6,750 billion,what is the cyclical deficit? (
D)Show what will happen to the relationship between the deficit and real GDP if Medicare and federal prison incarceration costs increase without any corresponding increase in taxes or reduction in other programs.

Question

The table below shows the relationship between the deficit and real GDP.Draw a diagram depicting this relationship.Assume potential GDP is $6,900 billion.  
(A)What is the structural deficit? (
B)If real GDP is $7,050 billion,what is the cyclical deficit? (
C)If real GDP is $6,750 billion,what is the cyclical deficit? (
D)Show what will happen to the relationship between the deficit and real GDP if Medicare and federal prison incarceration costs increase without any corresponding increase in taxes or reduction in other programs.

Quizplus · Accepted Answer

The Answer of The table below shows the relationship between the deficit and real GDP.Draw a diagram depicting this relationship.Assume potential GDP is $6,900 billion.  
(A)What is the structural deficit? (
B)If real GDP is $7,050 billion,what is the cyclical deficit? (
C)If real GDP is $6,750 billion,what is the cyclical deficit? (
D)Show what will happen to the relationship between the deficit and real GDP if Medicare and federal prison incarceration costs increase without any corresponding increase in taxes or reduction in other programs.

The Table Below Shows the Relationship Between the Deficit and Real