In the basic one-period model in Chapter 5, government spending is modelled as the acquisition of goods by
the government, with the government simply throwing the goods away. Is this an accurate way to capture
what the government does? If so, in what ways? If not, in what ways could we alter the model to make it
capture the role of the government more accurately?

Question

Quizplus · Accepted Answer

The Answer of In the basic one-period model in Chapter 5, government spending is modelled as the acquisition of goods by
the government, with the government simply throwing the goods away. Is this an accurate way to capture
what the government does? If so, in what ways? If not, in what ways could we alter the model to make it
capture the role of the government more accurately?

In the Basic One-Period Model in Chapter 5, Government Spending