Public Budgeting

This is a timed test and I only have 55 minutes to submit, can you do it? 6 questions, 4 Sentences each except question 6, needs to be 6-8 sentences.

Remember to:
a) explain the concepts discussed in the question
b) integrate those concepts into a cogent answer
c) do not give subjective, opinion based answers.

1. Explain the differences between a revenue bond and a general obligation (GO) bond. Which bond typically has a higher interest rate? Why is that interest rate typically higher?

2. Describe the steps of the typical capital budgeting process used in the public sector. What are the ultimate goals of this process? What are the strengths and weaknesses of this process?

3. Identify the key participants in the public bond financing process. What is the role of each of these participants in the bond financing process?

4. Examine the influence of the federal government’s fiscal policy and monetary policy on the lives of everyday Americans. How does fiscal policy make their lives better (or worse)? How does monetary policy make their lives better (or worse)?

5.What funding mechanisms are typically used on state and local governments by the federal government? Are these mechanisms effective or ineffective?

6. Central City is a locality of 45,000 citizens that operates twelve governmental departments (e.g. Police Department, Parks/Rec Department). This year, the Police Department has submitted the following items to the Finance Department for inclusion in the Capital Budget:
– One new police van $25,000
– Ten police body cameras $10,000
– Five bullet proof vests $5,000
– One Blackhawk taser replacement $500
– 100 canisters of mace $3000
– New air conditioner unit $5000
– 20 Police uniforms (dress and work) $10,000
Analyze these items. Are all of these items appropriate for a Capital Budget? Why or why not? Explain the financial and political costs of including these items in the Capital Budget. Explain the financial and political costs of excluding these items from the Capital Budget.