Assume the government has a balanced budget and that the economy is experiencing a period of growth higher than predicted, tax receipts (collected)…

1.Assume the government has a balanced budget and that the economy is experiencing a period of growth higher than predicted, tax receipts (collected) by the government are likely to

a. increase and result in a budget deficit. 

  b. increase and result in a budget surplus. 

2. If the government of the country of LiLand want to promote economic activity and increase Aggregate Demand, it should

a.  increase taxes on imported products and gasoline. 

b. pass a new spending bill to fund new infrastructure projects.

Can you show me how solve the following questions





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