Unformatted text preview: Outlays= taxes and borrowing-outlays tend to be unpredictable day to day-if govt not allowed to borrow-them taxes also unpredictable day to day-budget deficits are measure as % of GDP-3% of economy is “magic” cut off-don’t confuse deficit with debt-debt is the sum of all past deficits minus all past surpluses-is debt a problem? Depends is debt used to finance consumption or investment-debt for consumption must be repaid in future-debt for investment pay...
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- Fall '06
- Public Finance, budget deficit, Finance govt activities, policy -federal budget, revenue budget deficit, Recent budget Tax