Match each of the terms on the left with its definition on the right. Click on the term first and then click on the matching definition. As you match them correctly they will move to the bottom of the activity.
Cyclically adjusted budget balance Public debt Implicit liabilities Lump-sum taxes Discretionary fiscal policy Debt-to-GDP ratio Automatic stabilizers Fiscal year Social insurance Expansionary fiscal policy Contractionary fiscal policy | spending promises made by governments that are effectively a debt despite the fact that they are not included in the usual debt statistics. Canada’s largest implicit liabilities come from transfer programs, including the Canada Health Transfer (CHT), the Canada Social Transfer (CST), and benefits for retired and elderly people. fiscal policy that reduces aggregate demand by decreasing government purchases, increasing taxes, or decreasing transfers. government programs—like the Canada/Quebec Pension Plan (CPP/QPP), Old Age Security (OAS), and welfare—intended to protect families against economic hardship. government spending and taxation rules that cause fiscal policy to be automatically expansionary when the economy contracts and automatically contractionary when the economy expands without requiring any deliberate actions by policy-makers. Taxes that depend on disposable income are the most important example of automatic stabilizers. taxes that don’t depend on the taxpayer’s income. government debt held by individuals and institutions outside the government. an estimate of what the budget balance would be if real GDP were exactly equal to potential output. fiscal policy that is the direct result of deliberate actions by policy-makers rather than rules. government debt as a percentage of GDP, frequently used as a measure of a government’s ability to pay its debts. the time period used for much of government accounting, running from April 1 to March 31. Fiscal years are labelled by the calendar year in which they end. fiscal policy that increases aggregate demand by increasing government purchases, decreasing taxes, or increasing transfers. |