ECON102 Chapter Notes - Chapter 29: Deficit Spending, Umber, Output Gap

• School: University of Waterloo
• Department: Economics
• Course: ECON102
• Professor: Wentang Kuo

Document Summary

Fiscal policy the use of the federal budget to achieve macroeconomic objectives such as full employment, sustained long-term economic growth, and price level sustainability. The federal government and parliament make fiscal policy. Begins with consultation between minister of finance, department of finance, and their provincial counterparts. Main items in the federal budget (from the national income & expenditure accounts) Revenues federal go(cid:448)er(cid:374)(cid:373)e(cid:374)t"s re(cid:272)eipts, (cid:449)hi(cid:272)h (cid:272)o(cid:373)es fro(cid:373) 4 sour(cid:272)es: personal income taxes taxes paid by individuals on their income, largest revenue source, corporate income taxes taxes paid by companies on their profit. Indirect & other taxes hst and taxes on sale of gas and alcohol, second largest revenue source. Investment income income from government enterprises and investments. Outlays classified in 3 categories: transfer payments payments to individuals, businesses, other levels of government, and the rest of the world largest outlay by a big margin. E. g. unemployment cheques, welfare payments, subsidies, grants, and dues to organizations: expenditure on goods/services.