lect04272011

Federal government borrows annual borrowing g tr ta

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Unformatted text preview: funds Deficit? Federal government borrows Annual borrowing = ( G + TR ) – TA Who lends? Everyone Fiscal Policy Fiscal Policy International Terminology Exchange Rates & NX QUICK conclusion Fiscal Policy Fiscal Policy International Terminology Exchange Rates & NX QUICK conclusion 1 4/26/2011 8:48 AM But, but, but Definitions Ceteris paribus doesn’t apply doesn’ Closed Economy Open Economy Imports (IM) Exports (EX) Fiscal Policy Fiscal Policy International Terminology Exchange Rates & NX QUICK conclusion Fiscal Policy International Terminology International Terminology Exchange Rates & NX QUICK conclusion More Definitions Net Exports, or Trade Balance: EX - IM "Surplus" Surplus" $ flowing in > $ flowing out EX > IM "Deficit" Deficit" $ flowing in < $ flowing out EX < IM Trade surplus 1895 to mid-1970s mid Trade deficit since mid-19...
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