Measurement of the government budget deficit.

Measurement of the government budget deficit..

Describe four problems affecting measurement of the government budget deficit.
According to the traditional view of government debt, how does a debt-financed tax cut
affect public saving, private saving, and national saving?
According to the Ricardian view of government debt, how does a debt-financed tax cut
affect public saving, private saving, and national saving?
Do you find the traditional or the Ricardian view of government debt more credible? Why?
Give three reasons that a budget deficit might be a good policy choice.
Why might the level of government debt affect the government’s incentives regarding
money creation?

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