If government spending is held constant and Ricardian equivalence holds,
A) an increase in the government budget deficit is always matched by a reduction in private savings.
B) an increase in government savings is always matched by an increase in the government budget deficit.
C) an increase in government savings is always matched by an equal increase in private savings.
D) an increase in government savings is always matched by an equal reduction in private savings.
D
You might also like to view...
A political candidate promises voters more funding for AIDS research and child care and assures them they will not have to sacrifice any other goods or services to obtain the additional programs.
A. This may be possible if the economy has unemployed resources. B. This is possible only in a fully employed economy. C. This is possible if the economy is producing on its production possibilities curve. D. None of the choices are possible.
Economic growth would be illustrated by
A) a rightward shift of aggregate demand. B) a leftward shift of aggregate demand. C) a rightward shift of aggregate supply. D) a leftward shift of aggregate supply.
The principal-agent problem that exists for bank trading activities can be reduced through
A) creation of internal controls that combine trading activities with bookkeeping. B) creation of internal controls that separate trading activities from bookkeeping. C) elimination of regulation of banking. D) elimination of internal controls.
Underemployment refers to
A. The same thing as unemployment. B. A person who is not able to use her full capabilities in her job. C. A discouraged worker. D. A person who is lazy and not working hard at her job.