One consequence of government deficits is
A) lower interest rates.
B) lower taxes.
C) reduced government borrowing.
D) reduced consumer spending.
E) redistribution of the tax burden from one group to another.

Question

Quizplus · Accepted Answer

When the government runs a deficit, it means that it is spending more money than it is taking in through taxes and other revenue sources. This results in a larger national debt, which needs to be paid back over time. In order to pay back this debt, the government may increase taxes on certain groups or reduce spending on certain programs. This can result in a redistribution of the tax burden from one group to another, as some individuals or businesses may end up paying more in taxes than they did before.

One Consequence of Government Deficits Is