ECON MACRO
5th Edition
ISBN: 9781337000529
Author: William A. McEachern
Publisher: Cengage Learning
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Chapter 12, Problem 3.8P
Sub-part
A
To determine
the way in which the national debt is related to the government’s budget deficit. When the gross national debt is $3 trillion and the government’s budget deficit is $300 billion.
Concept Introduction:A budget is an estimation of revenue and expenses over a specified future period of time. A budget deficit occurs when expenses exceed revenue, and it is an indicator of financial health. To correct a budget deficit, a nation may need to cut back on certain expenditures, increase revenue-generating activities or employ a combination of the two.
Sub-Part
B
To determine
the way in which the national debt is related to the government’s budget deficit. When the gross national debt is $2.5 trillion and the government’s budget deficit is $100 billion.
Concept Introduction:A budget is an estimation of revenue and expenses over a specified future period of time. A budget deficit occurs when expenses exceed revenue, and it is an indicator of financial health. To correct a budget deficit, a nation may need to cut back on certain expenditures, increase revenue-generating activities or employ a combination of the two.
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Discuss the preferred deterrent method employed by the Zambian government to combat tax evasion, monetary fines. As noted in the reading the potential penalty for corporate tax evasion is a fine of 52.5% of the amount evaded plus interest assessed at 5% annually along with a possibility of jail time. In general, monetary fines as a deterrent are preferred to blacklisting of company directors, revoking business operation licenses, or calling for prison sentences. Do you agree with this preference? Should companies that are guilty of tax evasion face something more severe than a monetary fine? Something less severe? Should the fine and interest amount be set at a different rate? If so at why? Provide support and rationale for your responses.
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Discuss the preferred deterrent method employed by the Zambian government to combat tax evasion, monetary fines. As noted in the reading the potential penalty for corporate tax evasion is a fine of 52.5% of the amount evaded plus interest assessed at 5% annually along with a possibility of jail time. In general, monetary fines as a deterrent are preferred to blacklisting of company directors, revoking business operation licenses, or calling for prison sentences. Do you agree with this preference? Should companies that are guilty of tax evasion face something more severe than a monetary fine? Something less severe? Should the fine and interest amount be set at a different rate? If so at why? Provide support and rationale for your responses.
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