An increase in the public debt will:
A. decrease the U.S. debt held by citizens and institutions in foreign nations.
B. decrease the potential for higher taxation in the United States.
C. increase the inequality in the distribution of income.
D. increase incentives to work and bear risk.
Answer: C
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Which of the following statements is true about a command economy?
a. Shortages occur because of complexities in the planning process. b. Planners determine what, how many, and for whom goods and services are to be produced. c. Planners often allocate goods and services through a rationing system. d. The quality of produced goods and services tends to be inferior. e. All of these are true.
If aggregate expenditures are lower than real GDP:
A. actual real output is less than equilibrium real output. B. aggregate output increases. C. employment increases. D. there will be unplanned increases in inventories.
Which of the following is NOT a feature of a common market?
A) Substantial coordination of macroeconomic policies among the members B) Free trade in goods and services between the members C) Common external barriers to trade D) Factor mobility
The multiple by which the commercial banking system can increase the supply of money on the basis of each dollar of excess reserves is equal to:
A. the reciprocal of the required reserve ratio. B. 1 minus the required reserve ratio. C. the reciprocal of the income velocity of money. D. 1/MPS.