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The Logic of Ricardian Equivalence Implies That

Question 47

Multiple Choice

The logic of Ricardian equivalence implies that:


A) tax cuts do not influence consumer spending but changes in government spending do.
B) neither tax cuts nor changes in government spending affect consumer spending.
C) tax cuts combined with future decreases in government spending will decrease consumer spending.
D) if the government cuts taxes and increases current government spending, consumer spending will increase.

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