The Economic Way of Thinking 13th Edition by David Prychitko, Peter Boettke, Paul Heyne

Exercise 15

Suppose the Treasury borrowed $20 billion in September of the presidential election year in order to increase the benefits to be paid on October 1 to recipients of Social Security benefits, welfare grants, and unemployment compensation. What would be the effects on the money supply? On consumer spending in October? On the unemployment rate? On the price level? On the election? When would you expect these various effects?