Sector Balances after Period 1

• Answer: government's balance is $ -10; private sector's is $ 10

              Government                      Non-government

        \                    /            \                    /
         \                  /  Spend: 100  \                  /
          \     $ -10      /   --------->   \     $  10      /
           \              /    Tax:    90    \              /
            \            /     <---------     \            /
             \__________/                      \__________/

                $ -10               +             $  10           ≡   0

• The sector balances sum to 0