Because increased government spending or tax cuts cause higher government deficits, they also contribute to a rise in total planned expenditures and aggregate demand.
Explain how each of the following will affect the net public debt, other things being equal:
- Previously, the government operated with a balanced budget; however, recently, there has been a sudden increase in federal tax collections.
- The federal government had been operating with a very small annual budget deficit until three successive hurricanes hit the Atlantic Coast, and now government spending has risen substantially.
- The Government National Mortgage Association, a federal government agency that purchases specific types of home mortgages, buys U.S. Treasury bonds from another government agency.
Remember to adhere to APA guidelines, standards, and formatting.
Submit the analysis for grading in approximately two pages before the end of the week.
- Format: Microsoft Word
- Font: Arial, 12-point, double-spaced
- 6 years ago
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