You are an economic adviser to a candidate for national office. She asks you for a summary of the economic consequences of a balanced-budget rule for the federal government and for your recommendation on whether she should support such a rule. How do you respond?

Question

Shane Stanley

Business

9 October, 16:28

You are an economic adviser to a candidate for national office. She asks you for a summary of the economic consequences of a balanced-budget rule for the federal government and for your recommendation on whether she should support such a rule. How do you respond?

+1

Answers (2)

Know the Answer?

Rose Rice · Answer 1

Do not support such rule. This is the right answer

Lina Elliott · Answer 2

Recommendation: Do not support such rule

Explanation:

This type of budget rules restrain governments from employing taxes and transfers as automatic stabilizers. This due to the fact that these rules tend to bring deficits and surpluses.