Which of the following is a valid concern about federal budget deficits?
A) The welfare of future generations will be directly related to the per-capita size of the national debt that they inherit.
B) Growth of the national debt will eventually lead to the bankruptcy of the government.
C) When the debt comes due, future generations may be unable to pay it off.
D) If the increases in the national debt reduce private expenditures on capital formation, aggregate demand is reduced.
Correct Answer:
Verified
Q32: The crowding-out effect refers to:
A) higher interest
Q33: Supply-siders feel that high levels of government
Q34: If the crowding-out effect is strong, how
Q35: Most of the U.S. national debt is
Q36: When crowding out occurs, higher government spending
Q37: Crowding out occurs when the federal government:
A)
Q38: According to the crowding-out view, budget deficits
Q39: Supply-side economists argue that less government spending:
A)
Q41: Does government borrowing crowd out private sector
Q42: Are we passing the national debt burden
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