According to the Washington Post, small businesses are beginning to brace for a worst-case scenario of delayed payments, stalled projects and layoffs if the nation defaults on its debt.
- Briefly explain the ripple effect in the economy described in the article if default happens.
- What would be the estimated lost jobs?
- What would be the loss in household wealth?
- Even if a deal is reached, what instabilities in the economy are already evident?
Bhattarai, A. (2023). Small businesses are beginning to panic about a government default. The Washington Post, May 21 (Retrievable online at https://www.washingtonpost.com/business/2023/05/20/debt-ceiling-small-business/)
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