Question
If the structural budget deficit is $$\$ 100$$ billion and the actual deficit is $$\$ 300$$ billion, what is the size of the passive or cyclical deficit? $\mathrm{LO} 2$
Step 1
The structural budget deficit is the part of the budget deficit that would exist even if the economy were at full employment. The actual deficit is the total budget deficit observed. The passive or cyclical deficit is the part of the budget deficit that arises Show more…
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A government starts off with a total debt of $\$ 3.5$ billion. In year one, the government runs a deficit of $\$ 400$ million. In year two, the government runs a deficit of $\$ 1$ billion. In year three, the government runs a surplus of $\$ 200$ million. What is the total debt of the government at the end of year three?
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