The Cash for Clunkers program was intended to help the US auto industry and help the environment.Which of the following is often cited as a unintended consequence of the program?
A)it contributed to an increase in the US trade deficit
B)it helped Toyota surpass GM as the #1 auto maker in the world
C)it helped used car dealers more than new car dealers
D)it increased the federal deficit
E)it led to an acceleration of inflation in the USeconomy

Question

Quizplus · Accepted Answer

The unintended consequence of the Cash for Clunkers program was that it increased the federal deficit. The program provided incentives to consumers to trade-in their old, less fuel-efficient cars for new, more fuel-efficient cars. This led to an increase in car sales, but also an increase in government spending, ultimately adding to the federal deficit.

The Cash for Clunkers Program Was Intended to Help the US