Discussion – Government Borrowing, Sections 3 and 4 introduce
Discussion Question – Government Borrowing
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Overview: Sections 3 and 4 introduce some side effects of government borrowing. Some negative side effects include concern about inflation and higher interest rates in the private market, while positive side effects include the ability for government spending, which could lead to investment within the country and economic growth.
Task
1. Provide a situation where the government may decide to borrow money.
2. Explain this action’s purpose and the benefits of this borrowing move.
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