A rule of thumb is that a 1 increase in output leads ...

[big1devin]

A rule of thumb is that a 1 increase in output leads automatically to a reduction in the deficit of what percentage of GDP?
 
  A) 0.5
  B) 1
  C) 1.5
  D) 2

Question 2

The Ricardian Equivalence proposition suggests that a tax increase that causes a budget surplus will
 
  A) cause an increase in output.
  B) cause no change in output.
  C) cause a reduction in output.
  D) a reduction in consumption.

[zenzy]

Answer to Question 1

A

Answer to Question 2

B