Rather than simply comparing government revenues and tax receipts, analysts are

Question

Rather than simply comparing government revenues and tax receipts, analysts are sometimes interested in the "cyclically adjusted" budget balance. What does it mean to consider the cyclically adjusted budget balance? The cyclically adjusted budget balance accounts for decreases in tax revenues that occur during economic expansions and increases in tax revenues occurring during recessions. The cyclically adjusted budget balance accounts for what the budget balance would be in terms of spending patterns attributable to variations in the lunar cycle. The cyclically adjusted budget balance accounts for what the budget balance would be in terms of changes in the budget attributable to a university presidential election cycle. The cyclically adjusted budget balance accounts for what the budget balance would be in terms of the total value of goods and services produced in an economy and potential output.

Explanation / Answer

D is the answer

Here we have to take into account only stance of fiscal policy, that means what effect the fiscal policy had on the economy.

It esentially removes revenues and expenditure and just takes into account the fiscal condition of the economy.

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