Suppose the federal government had budget deficits of $40 billion in year 1 and $50 billion in year 2 but had budget surpluses of $35 billion in year 3 and $50 billion in year 4. Also assume that it used its budget surpluses to pay down the public debt. At the end of these four years the federal governments public debt would have   A.) increased by $5 Billion B) increased by $90 billion C.) decreased by $85 billion D) decreased by $5 billion

Q: A country has a rate of growth (g) of 0.75 %, a debt-to-income of 94% and a primary deficit of 0.9%…

A: The percentage change within the value of all products and services produced in a very country over…

Q: With the help of examples, discuss the resource allocation function, the distribution function and…

A: ▪︎Resource allocation function:- Resource allocation is the method involved with appointing and…

Q: A government finances all of its debt through 1-year treasury bonds. This government is able to…

A: Debt-to-GDP ratio is defined as a metric which compares a nation's public debt to its GDP. It…

Q: Now suppose that the gross national debt initially is equal to $2.5 trillion and the federal…

A: 1. The government is initially in the gross national debt of $2.5 trillion and the new deficit is…

Q: Suppose the stock of government debt in Canada at the e of year 1 is $475 billion. If the stock of…

A: Given Information Debt in 1st Year = $475Debt in  2nd Year = $461 Debt Payment = $38

Q: Question 27: Suppose that the primary deficit (G – T) is zero in the economy. Suppose further that…

A: The primary deficit refer to difference between fiscal deficit of current year and interest payments…

Q: The difference between the gross public debt and the net public debt is that the a. gross public…

A: Public debt: - Public debt is that situation in which government expenditure exceeds government…

Q: 03. Referring to Fig 2d and the attached table, determine whether average federal individual income…

A: A recession is the economic condition which brings contraction in the economic activities through…

Q: Assume a government has $28,667 in tax revenues and $40,094 in total government spending. What is…

A: Answer; Government budget balance= Tax revenue-total expenditure Here, Tax revenue = $28,667 and…

Q: The national debt O decreases when the government runs a budget deficit. O is the total amount of…

A: 1.Here answer is “is the total amount of government debt outstanding” National debt is the debt that…

Q: 7. Non-discretionary fiscal policy designed to counteract a reduction in aggregate demand might…

A: A non-discretionary fiscal policy refers to the government action or policy thay acts to deal with…

Q: Public debt is the sum of deficits and surpluses (negative deficits) over time. Suppose that a…

A: Public debt is the borrowed money that the government owes to its internal as well as foreign…

Q: Suppose potential GDP is $20 trillion. If the economy produces at potential, then the government…

A: When the government decides to balance the budget they effort for economic activities to equalize…

Q: Assume that the total federal debt is equal to $3 trillion.  Suppose now that the government runs a…

A: A budget deficit is a negative balance of budget that occurs when the government expenditures…

Q: he Effects of Fiscal Deficits on an Economy.

A: Fiscal deficits are unfavourable balances that develop whenever a government spends more within a…

Q: Government spending in Robok is $150 billion, and its only tax is an income tax with a marginal tax…

A: Government spending= $150 billion Marginal tax rate= 0.3 Government budget= $440

Q: a) Define what are  expansionary and contractionary discretionary fiscal policies.

A: Hey, Thank you for the question. According to our policy, we can only answer 1 question per session.…

Q: budget deficit and national debt.

A: Budget deficit: It is the difference between total receipts & expenditure in both revenue &…

Q: The real interest rate is equal to 0,05. The primary deficit-to-GDP ratio is equal to 0,05. The…

A: Real interest rate = 0.05 Deficit to GDP ratio = 0.05 Debt to GDP Ratio = 0.5

Q: Fiscal policy is used not only to influence economic activity but also for political purposes.…

A: Government fiscal policy refers to the expense that a government needs to provide goods and services…

Q: If the South African government can fund its deficits without the economy experiencing rising…

A: Unbalanced budget exists in an economy if its revenue collected from taxes and expenditure done by…

Q: The total public debt is more revelant to an economy than the public debt as a percentage of GDP. An…

A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…

Q: 2.8

A:

Q: Suppose that a country has no public debt in year 1 but experiences a budget deficit of $ 40 billion…

A: Public debt is the amount of money borrowed by the government. It is the amount that the country…

Q: Are large federal deficits and a growing federal debt sustainable? What can be learned from the…

A: Federal debt: It means the amount of money that the federal government has borrowed and not yet paid…

Q: Assume a government starts with zero debt. This government then runs an annual deficit for 10 years…

A: GIVEN     Assume a government starts with zero debt. This government then runs an annua deficit for…

Q: How do economists distinguish between the absolute and relative sizes of the public debt? Why is the…

A: Absolute size of the public debt: It is the total accumulation of the deficits (minus the surpluses)…

Q: lesae explain briefing what policy and implementation lags affect the potency of fiscal policy, and…

A: How fiscal policy works The use of taxation and government spending to impact the economy is…

Q: A government starts with a national debt of $3.5 billion. In year 1, the government runs a budget…

A: When government spending is more than government revenue, it is known as budget deficit. When…

Q: explain the impact of balanced budget on national debt

A: Primarily. lets clear on two basic concepts that will be used in the question under consideration:…

Q: xplain the five problems and criticisms that arise in the implementation of fiscal policy.

A: Fiscal policy is the policy that is adopted by the government to bring economic stability in the…

Q: Suppose that a country has no public debt in year 1 but experiences a budget deficit of $40 billion…

A: Public debt, year 4($ billion) = Public debt year 1 + Budget deficit, year 2 + Budget deficit, year…

Q: The Effects of Fiscal Deficits on an Economy.

A: Fiscal deficit refers to the difference between the expenditure and income of government or…

Q: A government debt is the O accumulation of past deficits minus surpluses O the deficit for the…

A: Government budget is in surplus when government revenue is higher than government expenditure. i.e.,…

Q: Question 1  What is the role of the Council Economic Advisers (CEA) as it relates to the…

A: given,First year budget deficit = $40 billionSecond year budget deficit = $20 billionThird year…

Q: Analyse the various policy measures that a government might have to undertake to deal with and…

A: A fiscal deficit occurs when government spending exceeds government receipts. An uncontrolled fiscal…

Q: Assume that the nominal interest rate is 11 percent, the inflation rate is 8 percent, and government…

A: Inflation is the rise in general price level of goods and services over period of time. fisher…

Q: Explain how governments need to recognise the impact of several time lags as a problem in fiscal…

A: Changes the government makes to spending or taxing in an effort to affect the state of the economy…

Q: Describe how a budget deficit arises and explain the corresponding action typically taken by a…

A: