Price level as measured by the CPI was 104 in 1984 and 251 in 2018. Calculate the value of interest payments made by the government in 1984, adjusted to 2018 dollars. Table 1: Federal Government receipts and expenditures and nominal GDP, billions of dollars.196719781984199920092018Tax receipts108280410117511241956Other receipts3814430273211161542Governmentpurchases and921733175019931121subsidiesGovernment52transfer payments23439798621412846Interest payments 2279194352355541Net governmentinvestment25|-3494Nominal GDP8602,352 4,3399,63114,449 20,580Source: Bureau of Economic AnalysisAssume the table above represents all federal government revenues and expenditures.

To calculate interest in 2018 prices, the 2018 CPI must be 100.

Answered: Price level as measured by the CPI was…

Price level as measured by the CPI was 104 in 1984 and 251 in 2018. Calculate the value of interest payments made by the government in 1984, adjusted to 2018 dollars.

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter12: The Design Of The Tax System

Section12.1: An Overview Of U.S. Taxation

Problem 1QQ

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Question

Price level as measured by the CPI was 104 in 1984 and 251 in 2018. Calculate the value of interest payments made by the government in 1984, adjusted to 2018 dollars.

Table 1: Federal Government receipts and expenditures and nominal GDP, billions of dollars.
1967
1978
1984
1999
2009
2018
Tax receipts
108
280
410
1175
1124
1956
Other receipts
38
144
302
732
1116
1542
Government
purchases and
92
173
317
501
993
1121
subsidies
Government
52
transfer payments
234
397
986
2141
2846
Interest payments 22
79
194
352
355
541
Net government
investment
25
|-3
49
4
Nominal GDP
860
2,352 4,339
9,631
14,449 20,580
Source: Bureau of Economic Analysis
Assume the table above represents all federal government revenues and expenditures.

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