Question

Consider Figure 14-2. The years immediately after 2008 stand out as having the highest values in the figure. The main reason is that the dollar magnitudes of the federal government's deficits were very large during these years. How might the fact that a significant economic contraction occurred during these years provide another explanation for why the percentages for these years were so high?

Short answer

The gap between the public use and public income because of the financial expenditure prompted the Federal Budget Deficit to contact a high of very nearly $10\%$of the GDP in 2009

Step-by-step solution

introduction

The liberation of the monetary business in the US allowing the banks to participate in the mutual funds exchanging with the subsidiaries through the Gramm-Rudman Act drove the worldwide economy into what is named by the market analysts as the most obviously awful Global Financial Crisis after the Great Depression of$1930$

explanation

Currently injured by the monetary effect of the fear assault in $2001$nursed by the financial upgrade bundle from that point forward and the yawning privilege spending, this monetary emergency has cleared a sliding way for the economy into the entanglement of the federal deficit. The dollar extent of the federal government's budget deficit timed a grievous $\$1.41$trillion in the monetary year $2009$being the single biggest budget deficit in US history.