AP Economics – 2/12/19
I. Bellwork: WS 30.3 Q&A
II Objectives:
- Explain why governments calculate the cyclically adjusted budget balance
- Identify problems posed by a large public debt
- Discuss why implicit liabilities of the government are also a cause for concern
III Discussion Pages 293-302
A. The Budget Balance
- The Budget Balance as a Measure of Fiscal Policy
SGovernment = T – G – TR
2. The Business Cycle and the Cyclically Adjusted Budget Balance
3. Should the Budget Be Balanced?
B. Long-Run Implications of Fiscal Policy
- Deficits, Surpluses, and Debt
- Problems Posed by Rising Government Debt
- Deficits and Debt in Practice
- Implicit Liabilities
IV Notes
V. Classwork
30.2 WS & 30.4WS
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