The government budget constant for an economy is given below: G + TR; + rD-1-T; = D¿ – D¿-1 where G = government spending, TR is transfer payments, rD;-1 is interest payments on public debt, T is tax revenue and D is the stock of public debt. ccording to the government budget constraint in what way (or ways) can government expenditures be funded? O a. by a combination of tax revenue and borrowing from the public O b. by printing money O c. by tax revenue O d. by borrowing from the public O e. by borrowing from the central bank

The government budget constant for an economy is given below: G + TR; + rD-1-T; = D¿ – D¿-1 where G = government spending, TR is transfer payments, rD;-1 is interest payments on public debt, T is tax revenue and D is the stock of public debt. ccording to the government budget constraint in what way (or ways) can government expenditures be funded? O a. by a combination of tax revenue and borrowing from the public O b. by printing money O c. by tax revenue O d. by borrowing from the public O e. by borrowing from the central bank

MACROECONOMICS

14th Edition

ISBN:9781337794985

Author:Baumol

Publisher:Baumol

Chapter11: Managing Aggregate Demand: Fiscal Policy

Section: Chapter Questions

Problem 1DQ

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