-In the above figure
A) the structural deficit equals zero.
B) any surpluses are cyclical surpluses.
C) any deficits are cyclical deficits.
D) All of the above answers are correct.

Question

-In the above figure
A) the structural deficit equals zero. 
B) any surpluses are cyclical surpluses. 
C) any deficits are cyclical deficits. 
D) All of the above answers are correct.

Quizplus · Accepted Answer

The correct answer is D because the structural deficit equals zero when the budget is balanced at the potential level of GDP, indicating that any surpluses or deficits are cyclical, depending on the economy's performance relative to its potential.

-In the Above Figure