Economics 1022A/B Lecture Notes - Deficit Spending, Output Gap, Real Interest Rate

• School: Western University
• Department: Economics
• Course: Economics 1022A/B
• Professor: Jeannie Gillmore

Document Summary

Cabinet and which become government policy then presents a budget plan to. Highlights of the budget: revenues, outlays, budget balance. Revenues are the federal government"s receipts, which come from four main sources: personal income taxes (largest source, corporate income taxes (smallest source) indirect and other taxes investment income. Revenues total revenues have no strong trends increased through the. Outlays total outlays increased from 1971 through 1985: relatively high through 1993, before decreasing afterward. Main source of the change was transfers to the provincial governments, which were cut drastically during the 1990s. Government debt is the total amount of government borrowing the sum of past deficits minus the sum of past surpluses. Alberta, saskatchewan, ontario, and bc receive the least amount of outlays. When individuals and businesses incur debts, they usually do so to buy capital (assets that yield a return) the government incurs debt to build highways, irrigation schemes, public schools and universities, libraries, and stock of national defence.