Chapter 13 - Deficit Spending and the Public Debt Flashcards
To memorize the terms and adapt those terms to answer the questions correctly.
What is government budget deficit?
An exuberance of government disbursement over government proceeds during a given duration of time.
What is balanced budget?
Government’s disbursement is accurately equal to the entire taxes and other proceeds it gathers during a given duration of time.
Is the national budget deficit a flow or a stock?
A flow.
What is government budget surplus?
An exuberance of government proceeds over government disbursement during a given duration of time.
Is public debt a stock or flow?
A stock.
What is public debt?
The entire worth of every outstanding national government securities.
Is the country debt a stock or a flow?
A stock.
What happened from 1997 to 2007?
The government witnessed budget exuberance.
What is the Annual Deficit Formula?
Government spending - Taxes collected
What is the deficit formula?
Federal Budget Spending - Federal Budget Receipts
What is the formula for Deficit as a % of GDP?
Deficit / GDP x 100
What is the gross public debt?
Every national government’s liabilities, heedless of who possesses it.
What is the net public debt?
Gross public debt - Financial assets held by the government
The gross national debt grows whenever the national government encounters a budget loss.
How can we decrease national budgets?
Grow taxes.
What is exchange deficit?
Canadian buy in eclipses the worth of its ship.
What happens when alien dollar holders buy new Canadian regime bonds?
They will have less dollars to disburse on Canadian elements, involving Canadian ship merchandise.
T/F Is it true alien dollar holders will want to buy more things with a bigger interest rate?
True.
What can happen if the frugality is below entire employment?
The regime deficit can shut - the recessionary gap.
What can happen if the frugality is above entire employment?
The regime deficit can build - the inflationary gap.
What happens when the regime disburses more than it gathers in taxes?
The regime takes up a bigger section of industrial enterprise.
Is there a association among the Canadian trade deficit and the national budget deficit?
Bigger trade deficits tend to follow bigger regime budget deficits.
What happens when there is a bigger interest rate?
Prices go down.
What happens when there is a lower interest rate?
Prices go up.
How can the regime decrease all its red ink?
- Grow taxes for everybody.
- Tax the wealthy.
- Decrease expenditures.
- Crucial Transfers to other positions of regime assistance to feed deficit disbursement.
What are the crucial transfers to other positions of regime?
- National government payments created to other positions of regime for health care, post secondary schooling, social help, and financial grant through the National-Provincial Financial Arrangements Act.
What is another way to reduce national budget deficits?
Reduce government disbursement. (Transmissions to individuals), rewards ensured under government events - Old Age Security and Employment Insurance.
Who will gain rewards in the long duration from bigger budget deficits?
People who collect the bigger contribution of the yearly flow of real GDP to regime-supplied merchandise and services: people that the merchandise and services are redelivered.
