Which of the following would be true if all the national debt were owned internally?
A. The federal government would not need to refinance the national debt.
B. The federal government would not need to worry about raising taxes to pay interest on the national debt.
C. We would still be concerned about the effect on the distribution of income from interest payments on the national debt.
D. Budget surpluses would be more likely than budget deficits.
Answer: C
You might also like to view...
How could return-chasing explain why many of Enron's employees lost most of their retirement savings when Enron went bankrupt?
What will be an ideal response?
Many fast-food restaurants have signs on their cash registers that read, "Your meal is free if the cashier does not give you a receipt". What might be the purpose of such a sign? Hint: there is a moral hazard problem here
What will be an ideal response?