Suppose that a country has no public debt in year 1 but experiences a budget deficit...
Suppose that a country has no public debt in year 1 but experiences a budget deficit of
$ 40$40
billion in year 2, a budget surplus of
$ 10$10
billion in year 3, a budget surplus of
$ 15$15
billion in year 4, and a budget deficit of
$ 4$4
billion in year 5.
The absolute size of public debt at the end of year 5 is
$nothing
billion. (Enter your response as a whole number.)
Homework Answers
Ans) public debt is the sum of all deficita and surpluses
Public debt = 40 - 10 -15 + 4 = $19
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