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Selena Venegas
on Nov 11, 2024

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The Great Recession of 2007-2009 and the financial crisis of 2008 increased the budget deficit because of:

A) an increase in the tax rates for high-income households.
B) a sudden increase in terrorist attacks and anthrax scares in the economy.
C) low interest rates that crowded out private investment.
D) discretionary tax cuts and greater outlays on unemployment benefits.
E) greater outlays on national defense spending.

Great Recession

A significant global economic downturn that occurred from late 2007 through to 2009, marked by severe declines in economic activity worldwide.

Financial Crisis

A broad term for a situation in which financial assets suddenly lose a large part of their nominal value, leading to market disruptions and potentially an economic downturn.

Budget Deficit

The financial situation in which a government's expenditures exceed its revenues within a given fiscal year, leading to borrowing or debt accumulation.

  • Comprehend the elements that lead to federal deficits and their impact on the Gross Domestic Product of the United States.
  • Understand the effects of discretionary fiscal policy on economic conditions.
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Prafulla Man PradhanNov 14, 2024
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