A cyclically adjusted budget balance: a. is an estimate of what the budget balance would be if real GDP were equal to potential output. b. is the same as the national debt, and it rises as interest cost is accrued. c. shows what the budget balance would be with a significant amount of cyclical unemployment. d. is a good indicator of the depreciation of the capital stock.

T-comm makes a variety of products. it is organized in two divisions, north and south. the managers for each division are paid, in part, based on the financial performance of their divisions. the south division normally sells to outside customers but, on occasion, also sells to the north division. when it does, corporate policy states that the price must be cost plus 20 percent to ensure a "fair" return to the selling division. south received an order from north for 300 units. south's planned output for the year had been 1,200 units before north's order. south's capacity is 1,500 units per year. the costs for producing those 1,200 units follow