Suppose we have an economy in which G = 1100,t = 0.26,Y = 3800,and YN = 4000.At Y,the actual deficit is

Name: Suppose we have an economy in which G = 1100,t = 0.26,Y = 3800,and YN = 4000.At Y,the actual deficit is
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The actual deficit is calculated as the difference between government spending (G) and tax revenues. Tax revenues can be calculated as t * Y, where t is the tax rate and Y is the income. So, tax revenues = 0.26 * 3800 = 988. The actual deficit is then G - tax revenues = 1100 - 988 = 112.

Suppose We Have an Economy in Which G = 1100,t