ECON MACRO (with ECON MACRO Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
5th Edition
ISBN: 9781305659094
Author: William A. McEachern
Publisher: Cengage Learning
expand_more
expand_more
format_list_bulleted
Question
Chapter 12, Problem 4.9P
To determine
Long-term effects of deficit spending.
Concept Introduction: Deficit spending occurs whenever a government's expenditures exceed its revenues over a fiscal period, creating or enlarging a government debt balance. One of the reasons for deficit spending is the conscious attempt to stimulate the economy by lowering tax rates or increasing government expenditures.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionChapter 12 Solutions
ECON MACRO (with ECON MACRO Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
Knowledge Booster
Similar questions
- What is the main reason for employing expansionary fiscal policy during a recession?arrow_forwardDuring the Great Recession of 20082009, what actions would have been required of Congress and the President had a balanced budget amendment to the Constitution been ratified? What impact would that have had on the unemployment rate?arrow_forwardUnder what general macroeconomic circumstances might a government use expansionary fiscal policy? When might it use contractionary fiscal policy?arrow_forward
- Why is spending by the U.S. government on scientific research at NASA fiscal policy while spending by the University of Illinois is not fiscal policy? Why is a cut in the payroll tax fiscal policy whereas a cut in a state income tax is not fiscal policy?arrow_forwardA government starts off with a total debt of $3.5 billion. In year one, the government runs a deficit of 400 million. In year two, the government runs a deficit of 1 billion. In year three, the government runs a surplus of 200 million. What is the total debt of the government at the end of year three?arrow_forward
arrow_back_ios
arrow_forward_ios
Recommended textbooks for you
- Principles of Economics 2eEconomicsISBN:9781947172364Author:Steven A. Greenlaw; David ShapiroPublisher:OpenStax
- Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Principles of Economics 2e
Economics
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:OpenStax
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning