Were Ronald Reagan's Massive Deficits a Deliberate Strategy to Bring

question 54

Essay

Were Ronald Reagan's massive deficits a deliberate strategy to bring an end to the expansion of the liberal welfare state or simply the necessary consequences of Reagan's massive tax cuts that he had to accept? What were the long-term consequences of the massive budget deficits for the liberal welfare state and its social programs?

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Definitions:

Marginal Cost

Marginal cost is the increase or decrease in the total cost that arises when the quantity produced is incremented by one unit.

Average Variable Cost

The cost of production that varies with the output level, calculated by dividing the total variable costs by the number of units produced.

Average Product

is the output per unit of input, such as the quantity of goods produced per labor hour, and is used to measure productivity.

Marginal Cost

The expenditure resulting from the creation of an additional unit of a product or service.