The Ricardo-Barro effect holds that
A) equal increases in taxes and government expenditures have no effect on equilibrium real GDP.
B) government budget deficits have no effect on the real interest rate.
C) a government budget deficit crowds out private investment.
D) a government budget deficit induces a decrease in saving that magnifies the crowding out effect.
B
You might also like to view...
The United States Congress of Industrial Organizations was born as a result of all of the following except
a. minimum wage laws that brought increased competition to unionized workers b. the industrial growth brought about by technological change c. craft orientation being an impediment to further union growth d. the need for broader representation of workers with very different skills and occupations but belonging to a common industry e. the failure of craft unions to restructure its orientation according to the needs of industrial workers
Voluntary exchange requires that there must be mutual gain
a. True b. False Indicate whether the statement is true or false
Which of the following statements is correct, when the exchange rate changes from €2/$ to €1.5/$?
a. The euro (€) depreciates. b. The dollar ($) appreciates. c. Both the euro and the dollar appreciate. d. Both the euro and the dollar depreciate. e. The euro appreciates and the dollar depreciates.
Refer to the below graphs. The formation of an exclusive or craft union, with no change in demand, is depicted by situation:
A. A
B. B
C. C
D. D