) If at the beginning of the year the public debt is $20 trillion, government spending and transfers are $2 trillion, and tax revenues are $3 trillion in 2019. Suppose that there is an annual interest rate of 10% on the debt added on at the end of the year. What would be the public debt at the beginning of the next year? Instructions: If the answer is not a whole number you should leave one number after the decimal. E.g. If the answer is 10.2778 it can be entered as 10.3. Leave your answer in trillions. You just need to put the number in your answer, no units or commas Answer:

) If at the beginning of the year the public debt is $20 trillion, government spending and transfers are $2 trillion, and tax revenues are $3 trillion in 2019. Suppose that there is an annual interest rate of 10% on the debt added on at the end of the year. What would be the public debt at the beginning of the next year? Instructions: If the answer is not a whole number you should leave one number after the decimal. E.g. If the answer is 10.2778 it can be entered as 10.3. Leave your answer in trillions. You just need to put the number in your answer, no units or commas Answer:

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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3. Budget balances and the national debt The following table lists federal expenditures, revenues, and GDP for the U.S. economy during several years. All numbers are in billions of dollars. Revenues Year (Billions of dollars) 1929 3.9 1948 1967 1986 2005 FEDERAL EXPENDITURES AND RE VENUES (Percent of GDP) 25 20 15 10 41.6 Plot the data for revenues and expenditures as a percentage of GDP on the following graph, rounded to the nearest percent. Use the orange points (square symbol) for expenditures and the green points (triangle symbol) for revenues. Line segments will automatically connect the points. 1929 148.8 769.2 2,153.9 Expenditures GDP (Billions of dollars) (Billions of dollars) 3.1 103.6 1948 29.8 157.5 990.4 2,472.2 1987 YEAR 1986 269.2 2005 832.6 4,462.8 12,421.9 Expenditures Δ Revenues ?
Directions: click on the graph in the window on the right and select Time Series to graph the U.S. public (federal) net outstanding debt as a percentage of GDP for the years 1940-2005. For Y Axis1 select Net Federal Debt, percentage of GDP. Use the figure to help determine which of the following statements are true. O A. The U.S. net federal debt to GDP ratio has been, for the most part, decreasing since the end of World War II, despite the fact that the U.S. economy was expanding and could afford a larger debt to GDP ratio. OB. As a result of the exceptionally large increases in U.S. government military expenditures in the first half of the 1940's, that were needed to win World War II, the net U.S. public debt to GDP ratio increased substantially, surpassing 100%. Since the late 1950's however, U.S. net federal debt to GDP ratio has fluctuated within a relatively small bend around the 40% line. OC. The net U.S. federal debt to GDP ratio follows a pattern that cannot have a meaningful…
An economy is in long-run macroeconomic equilibrium when each of the following aggregate demand shocks occurs. What kind of gap - inflationary or recessionary - will the economy face after the shock, and what type of fiscal policies would help move the economy back to potential output? How would your recommended fiscal policy shift the aggregate demandcurve? (Note: you do not need to draw anything).(a) A stock market boom increases the value of stocks held by households.(b) Firms come to believe that a recession in the near future is likely.(c) Anticipating the possibility of war, the government increases its purchases of military equipment.(d) The quantity of money in the economy declines and interest rates increase.
Consider an economy in which people spend 90 percent of each additional dollar of income they earn. If the government does easy (expansionary) fiscal policy via changing taxes by $2000, what will be the total effect on Y? Carefully follow all numeric instructions. Use a positive number (no sign) to show an increase in Y and a negative number (with negative sign) to show a decrease.
Suppose that in 2011, Mexico's total government outlays were 657 billion pesos and total government revenue was 550 billion pesos. Calculate Mexico's budget surplus or deficit. Be sure to include a negative sign if appropriate. billion pesos Select the answer that best describes the impact that the surplus or deficit you calculated will have on Mexico's debt. Mexico's debt will rise by an amount equal to the size of the deficit O Mexico's debt will not change. OMexico's debt will fall by an amount equal to the size of the surplus
Question 18/28 > NEXT A BOOKMARK 18 According to the pie chart, which of the following provides the most revenue for the federal government? Federal Tax Revenue 2015: $3.18 trillion Corporate Inco Taxes Miscellaneous Individual Income Taxes Excise Taxes $1.48 trillion 47% Customs Duties Payroll Taxes $1.07 trillion 34% nationalpriorities.org PRIORITIES A Individual income taxes B Corporate taxes C Payroll taxes D Excise taxes DELL -> @ # $ 7 8. 1 4 W e y < O 5
8. Agreement and disagreement among economists Suppose that Larry, an economist from a college in Pennsylvania, and Megan, another economist from an investigative reporting group, are both guests on a popular science podcast. The host of the podcast is facilitating their debate over budget deficits. The following dialogue represents a portion of the transcript of their discussion: Megan: Most people recognize that the budget deficit has been rising considerably over the last century. We need to find the best course of action to remedy this situation. Larry: I believe that a cut in income tax rates would boost economic growth and raise tax revenue enough to reduce budget deficits.. Megan: I actually feel that raising the top income tax rate would reduce the budget deficit more effectively. The disagreement between these economists is most likely due to differences between perception versus reality Despite their differences, with which proposition are two economists chosen at random most…
3. In FY 2017 (the fiscal year 2017 is from October 1, 2017 to September 30, 2018), the U.S. Federal Government had a total revenue of about $3.33 trillion and total expenditures of $4.11 trillion. The GDP for that year was $20.23 trillion. (a) How much was the federal deficit for FY 2017? (b) The national debt as of the end of FY 2016 was $20.245 trillion. Using (a), calculate the national debt as of the end of FY 2017. (c) Find the debt/GDP ratio at the end of FY 2017. (d) Find the deficit/GDP ratio for FY 2017. 4. In FY 1987, the national deficit was $155 billion. By what percentage did the deficit change between 1987 and 2017 (30 years)? Use your answers from the previous exercise.
Government Spending Tax Revenues GDP Year 1 $450 $425 $2,000 Year 2 500 450 3,000 Year 3 600 500 4,000 Year 4 640 620 5,000 Year 5 680 580 4,800 Year 6 600 620 5,000 The accompanying table gives budget information for a hypothetical economy. Assume that all budget surpluses are used to pay down the public debt. The public debt declined in year
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12. The national debt in the current year is equal to the national debt at the beginning of the year minus the annual budget deficit. a. b. equal to the national debt at the end of the year plus the annual budget deficit. equal to the national debt at the beginning of the year plus the annual budget deficit. C. d. none of the above. H. I
D4) country’s GDP growth rate is 6%, the interest rate on its debt (all local currency) is 8%, and its debt-to-GDP ratio is 95%. What does the country have to do to keep its debt-to-GDP ratio below 100%? Group of answer choices Keep its primary deficit below 8.05% of GDP Run a primary surplus of 8.05% of GDP. Bring its primary deficit down to zero. Raise its GDP growth rate to 8%.