According to the Ricardian equivalence theorem, people increase savings today when the government increases deficits because they recognize that:
A) government deficits imply higher future taxes.
B) government deficits imply lower future taxes.
C) consumption reduces future taxes.
D) consumption increases future taxes.
Correct Answer:
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Q1: The Ricardian equivalence theorem is correct if
Q3: Automatic stabilizers are government programs or policies
Q4: According to the Ricardian equivalence theorem, government
Q5: Sound finance holds that government spending should
Q6: The concept of fiscal policy refers to
Q7: According to the Ricardian equivalence theorem, people
Q8: Which of the following best describes most
Q9: If the government knew the level of
Q10: The elimination of automatic stabilizers would decrease
Q11: The theoretical proposition that government deficits do
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