1. A decrease in government spending and an increase in taxes will cause the:

a. budget deficit to decrease.

b. budget deficit to increase.

c. budget deficit to remain unchanged.

d. government debt to increase.

2. A firm's short-run total cost (TC) is equal to:

a. fixed costs plus variable costs.

b. variable cost minus total cost.

c. total cost divided by variable cost.

d. fixed cost minus variable cost.