An important reason why Ricardian equivalence may fail is if
A) borrowing and lending are done through intermediaries.
B) government debt incurred today may not be paid off until after some current consumers are deceased.
C) state and local governments also engage in debt finance.
D) some consumers are borrowers, while other consumers are lenders.
Correct Answer:
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Q56: An increase in the real interest rate
A)
Q57: The Ricardian equivalence implies that
A) the level
Q58: In a two-period model,government spending is financed
Q59: The substitution effect of a change in
Q60: An increase in second-period income results in
A)
Q61: Which condition would generate a violation of
Q62: When different consumers pay different amounts of
Q63: Distorting taxes can invalidate Ricardian equivalence because
A)
Q65: The Ricardian Equivalence holds only if
A) the
Q66: Which of the following is not a
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