In: Economics
What is the proposed Budget deficit for 2018? Why is the deficit currently so large and should the government be more focused on a balanced budget?
i) As a Keynesian economist, defend the use of this deficit spending to help the economy. Use the AD/AS model in your answer.
ii) As a Classical economist explain using the “crowding out” theory why you are opposed to this deficit spending. Use graphical support in your answer.