Question

Federal government purchases, as a percentage of GDP,

a. have remained roughly the same since the early 1950s.
b. rose from the early 1950s until the mid 1980s, and then fell.
c. have fallen since the early 1950s.
d. have risen since the early 1950s.

Answer 1

Federal government purchases, as a percentage of GDP, have remained roughly the same since the early 1950s, hovering between 18% to 22% most of the time since 1960, according to the historical data presented in the figures.

Step-by-step explanation:

The question pertains to the trend of federal government purchases as a percentage of the Gross Domestic Product (GDP) since the early 1950s. According to the given information, federal government spending as a share of GDP has varied within a certain range for most of the time since 1960. Although the overall federal government size may feel like it's been increasing, federal spending has typically been between 18% to 22% of GDP. Notably, defense spending decreased from the 1960s through the 1990s, and Social Security and healthcare expenses have risen as a percent of GDP. This suggests that while some categories of government spending have grown, others have decreased, keeping total spending within a relatively stable range.

Given this information, the correct answer is (a) federal government purchases, as a percentage of GDP, have remained roughly the same since the early 1950s.

Answer 2

Based on the provided information, federal government purchases as a percentage of GDP have seen periods of both rise and fall since the 1950s, with defense spending decreasing and spending on Social Security and healthcare increasing over time. The most accurate answer to the question is (b) 'rose from the early 1950s until the mid 1980s, and then fell.'

Given the information provided, we can answer the student's question regarding federal government purchases as a percentage of GDP. The data indicates that federal spending has generally been between 18% to 22% of GDP since 1960, with fluctuations primarily due to changes in spending on defense, Social Security, healthcare, and interest payments. More specifically, defense spending has decreased as a percentage of GDP since the 1960s with notable increases during the 1980s and post-9/11 period, while spending on Social Security and healthcare has increased. The federal spending level even climbed above the usual 18-22% range during 2009 and 2020.

From the provided options, the closest match to these observations would be (b) 'rose from the early 1950s until the mid 1980s, and then fell.' This is because after the 1980s, despite the fluctuation, there has been a general trend of decline in defense spending which reduced the overall federal spending as a percentage of GDP.