Persistent government budget deficit result in ________ taxes and a ________ stock of capital in the future.

Question

Quizplus · Accepted Answer

Persistent government budget deficits mean that the government is spending more than it is collecting in revenue, which results in a higher level of debt. To finance this debt, the government may have to increase taxes, which may discourage investment and lead to a smaller stock of capital in the future. Therefore, the answer is C - higher taxes and a smaller stock of capital.

Persistent Government Budget Deficit Result in ________ Taxes and a ________

Persistent Government Budget Deficit Result in Taxes and a