Public Debt
Because increased government spending or tax cuts cause higher government deficits, they also contribute to a rise in total planned expenditures and aggregate demand.
Tasks:
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.
Submission Requirements:
Submit the analysis for grading in approximately two pages before the end of the week.
- Format: Microsoft Word
- Font: Arial, 12-point, double-spaced
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