Day 1 OutlineClass Begins

1:30 pm – 2:00 pm Lecture on GMEs and World Economy

2:00 pm – 2:20 pm Organization of Daily Brainstorming Groups(Choose leaders and today's spokesperson, consider Afternoon

Topic, PPT)

2:20 - 2:30 pm 10 Minute Break

2:30 pm – 3:20 pm Group Brainstorming Session on Afternoon Topics

3:20 pm – 3:30 pm 10 Minute Break

3:30 pm – 4:30 pm 8–10 minute commentary on selected Afternoon Topic by each

group

Class Ends

rB PG PY B Mt+ = +D +D

Deficit D rB PG PYt= º + -

Simple Model of Debt and DeficitsDebt B=

/D

Deficit GDPPY

= / /Debt GDP B PY=

( ) ( )

( ) ( )

B G B MrPY Y PY PY

brb g b

b V

bg b

b V

t

qt p l

qt l r

D D+ = + +

DÞ + - = + + +

DÞ = - - - -

*( )g

Vb

qt

l r

- -=

-

Debt Service = rB r

bPYt t

=

According to a Forbes article in late 2011, total taxes in Japan were 48 trillion yen total debt service was 21.5 trillion yen. Also, nominal GDP in Japan in 2011 was 468 trillion yen. Plugging these numbers into our formula above

b = B/PY = 2.2 τ = 48/468 = 0.1026 Debt Service to Taxes = 21.5/48 = 0.448Therefore we can calculate

r = 2.01