An introduction to debt and government response

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Presentation transcript:

An introduction to debt and government response

Fiscal Policy The use of taxation and government spending to influence the economy is called fiscal policy. What goods and services to government pay for? When government collects taxes to pay for these, it is engaging in fiscal policy.

Monetary Policy How much money the government decides to print and put into circulation is monetary policy. What happens to the prices of things with more money in the economy? Think….why is a hundred dollar bill special?

In a time of large debt.. How should the government respond? What should it’s fiscal and monetary policy be?