National Budget Simulation

1. How will the program cuts that you made affect specific groups (the elderly, students, environmentalists, savers, the poor, foreign aid recipients, producers, etc.)? The program will cut based on the requirement of the national budget that will affect to the specific groups such as students, the elderly, environmentalists, savers, the poor, foreign aid recipients, producers, etc. It cant reduce the net interest paid to the debt.

2. What programs did you choose to cut? Why did you choose those programs over others? The programs that need to cut are general science, space and technology, international affairs, commerce and housing credit, income security, General Government because these programs are not highly needed and can be managed for the small budget. 3. Would other cuts have had less impact on peoples lives? Which budget cuts had the largest impact on reducing the deficit? Veterans benefits and services, Administration of justice, social security will have less impact on the peoples lives. Veterans benefits and services will cut the largest impact on reducing the deficit.

4. Which decisions might be perceived as politically motivated? Not to raise the taxes, not increase in transportation, energy and education will be perceived as politically motivated. No other decision of spending cut will help like these.

5. What are the tradeoffs of preserving some programs while protecting others? The programs that dont affect the human life literally such as income tax, energy bill etc. need not be cut but some other can be cut in case of use of governance.

6. How do your decisions result in the marginal benefit to society outweighing the marginal cost to society? The decisions through the result create marginal benefit to the society by not increasing the cover expenses to live their life.

7. If you had the opportunity to raise taxes rather than cut programs, which policy would you choose? Increase in taxes will be chosen if the raise in tax is not much higher. Cut programs will reduce the growth activities for a specific program.

References 1. Bittle, Scott (2011). Where Does the Money Go? Harper 2. U.S. Congressional Budget Office, An Analysis of the President's Budgetary Proposals for Fiscal Year 2010, June 2009 3. Bernanke, Ben S. (April 27, 2010). "Speech before the National Commission on Fiscal Responsibility and Reform: Achieving fiscal sustainability". Federalreserve.gov 4. Sullivan, Arthur; Steven M. Sheffrin (2003). Economics: Principles in action. Upper Saddle River, New Jersey 07458: Pearson Prentice Hall. pp. 502