Calculate the real deficit or surplus in the following cases: a. Inflation is 11 percent. Debt is $1 trillion. Nominal deficit is $90 billion. Instructions: Round your answer to the nearest whole dollar amount. $ billion. b. Inflation is 11 percent. Debt is $1 trillion. Nominal deficit is $150 billion. Instructions: Round your answer to the nearest whole dollar amount. $ billion. c. Inflation is - 5 percent. (Price levels are falling.) Debt is $300 billion. Nominal deficit is $40 billion. Instructions: Round your answer to the nearest whole dollar amount. $ billion. d. Inflation is 1 percent. Debt is $3 trillion. Nominal surplus is $50 billion. Instructions: Round your answer to the nearest whole dollar amount. $ billion.

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Business

Bridger Pace

11 July, 01:19

Calculate the real deficit or surplus in the following cases: a. Inflation is 11 percent. Debt is $1 trillion. Nominal deficit is $90 billion. Instructions: Round your answer to the nearest whole dollar amount. $ billion. b. Inflation is 11 percent. Debt is $1 trillion. Nominal deficit is $150 billion. Instructions: Round your answer to the nearest whole dollar amount. $ billion. c. Inflation is - 5 percent. (Price levels are falling.) Debt is $300 billion. Nominal deficit is $40 billion. Instructions: Round your answer to the nearest whole dollar amount. $ billion. d. Inflation is 1 percent. Debt is $3 trillion. Nominal surplus is $50 billion. Instructions: Round your answer to the nearest whole dollar amount. $ billion.

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Answers (1)

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Cassie Cameron · Answer 1

The computation is shown below:

As we know that

Real Deficit = Nominal Deficit - (Inflation * Total Debt)

a.

Real deficit = $90 - (11% * $1,000)

= - $20 billion surplus

b.

Real deficit = $150 - (11% * $1,000)

= $40 billion deficit

c.

Real deficit = $40 - (-5% * $300)

= $55 billion deficit

d.

Real deficit = - $50 - (1% * $3,000)

= - $80 billion surplus