Macroeconomics (7QQMM201)
MSc in Economics and Finance
King’s Business School
King’s College London
Term 1, 2020-2021
Tutorial questions for Lecture 8 – Answer Key
Note: the asnwer keys provided are indicative. This means that there is room for further
developing the answers (e.g., refer to the literature, provide applied policy exampes, etc.).
It also means that there might be other ways to approach the problem and provide a valid
answer.
QUESTION 1
If an individual should subtract the present value of future tax obligations due to the
government deficit from his or her disposable income, this situation suggests that, in
aggregate analysis, the government deficit should be subtracted from disposable income.
