The correct answer is "budget deficit".

Here's why:

1. A balanced federal budget means that the government's income, mainly from taxes and fees, equals its total expenditures.

2. An expansionary fiscal policy is a government policy that seeks to stimulate economic growth. This is often achieved by increasing government spending or reducing taxes, which can stimulate demand and lead to increased production and employment.

3. If the government increases its spending without increasing its income, or if it reduces its income without reducing its spending, it will spend more than it earns. This situation is known as a budget deficit.

So, if the economy starts out with a balanced federal budget, a subsequent expansionary fiscal policy will create a budget deficit.

Question

The correct answer is "budget deficit".

Here's why:

1. A balanced federal budget means that the government's income, mainly from taxes and fees, equals its total expenditures.

2. An expansionary fiscal policy is a government policy that seeks to stimulate economic growth. This is often achieved by increasing government spending or reducing taxes, which can stimulate demand and lead to increased production and employment.

3. If the government increases its spending without increasing its income, or if it reduces its income without reducing its spending, it will spend more than it earns. This situation is known as a budget deficit.

So, if the economy starts out with a balanced federal budget, a subsequent expansionary fiscal policy will create a budget deficit.

Knowee AI · Accepted Answer

The correct answer is "budget deficit".

Here's why:

1. A balanced federal budget means that the government's income, mainly from taxes and fees, equals its total expenditures.

2. An expansionary fiscal policy is a government policy that seeks to stimulate economic growth. This is often achieved by increasing government spending or reducing taxes, which can stimulate demand and lead to increased production and employment.

3. If the government increases its spending without increasing its income, or if it reduces its income without reducing its spending, it will spend more than it earns. This situation is known as a budget deficit.

So, if the economy starts out with a balanced federal budget, a subsequent expansionary fiscal policy will create a budget deficit.

If the economy starts out with a balanced federal budget, a subsequent expansionary fiscal policy will create a Blank______.Multiple choice question.budget deficitbudget surpluslower tax ratelower inflation rate

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