Suppose the stock of government debt in Canada at the e of year 1 is $475 billion. If the stock of debt falls to $461 bi by the end of year 2 and debt-service payments during yea were $38 billion, then we know that the government had...

Suppose that the existing stock of debt in Outland is $500500 billion, and the government expects to collect $184184 billion as net tax revenues. If the interest rate in this economy is 11 percent and the government wants to decrease its existing stock of debt by $4040 billion this year, then what should the government run this year?

Consider the government debt at the beginning of the year 2010 equals $2 000, the annual interest rate on the government debt – 8%. Government expenditures over the current year 2010 equal $1 500, government transfers - 20% of output. Government income is 40% of output. Calculate the government debt burden (government debt to total output) at the end of the current year 2010 if the output equals $5 000.

Year  Government Purchases  Government Taxes  Real GDP 1 400 247 5,812 2 434 203 5,898 Suppose there is no public debt before Year 1 and that net transfers are equal to zero.  What is the public debt as a percentage of GDP in Year 2? Answer this as a percentage and round your answer to two digits after the decimal without the percentage sign. ex. If you found the rate to be 5.125%, answer 5.13.

Federal government expenditures and receipts for the simple economy of the nation of Topanga are listed in the table below. The government of Topanga would like to reduce the debt-to-GDP ratio, and the Finance Minister of Topanga has proposed the following: "The best way to reduce the debt-to-GOP ratio is to increase GDP, because with a larger GDP, the ratio will have to get smaller, 1 therefore propose that goverment expenditures be increased by 25 percent, personal income taxes be reduced by 25 percent, corporate income taxes be reduced by 25 percent, and contributions for social insurance be reduced by 25 percent. All of these moves will increase GDP by 10 percent by increasing consumer spending, business spending, and government spending by the exact amounts of the increased spending and reduced taxes. Debt GOP Goverment expenditures Goverment transfer payments Interest payment Personal income tax receipts Corporate income tax receipts Contributions for social insurance $20 million…

Describe the potential consequences of maintaining high public debt.

The government budget is in DEFICIT when OT G-Transfers (TR) - Interest on the Debt (INT) 0 Government expenditures (G) - Investment expenditures (I) 0

Now suppose that the gross national debt initially is equal to $2.5 trillion and the federal government then runs a deficit of $100 billion. What is the new level of gross national debt? If 100 percent of this deficit is financed by the sale of securities to the public, what happens to the level of debt held by the public? What happens to the level of gross deb

In the beginning of the year, the economy has public debt (or national debt) of $450 million. This year, tax revenues collected by the government is $40 million and government outlays are $55 million. At the end of the year, this country has public debt (or national debt) of $____ million. Your Answer: Answer