Deficit spending and a large national debt can have important effects on future generations because they
a. make it possible for those living in the present to pass the opportunity costs of current government spending on to future generations.
b. can significantly impact spending on capital formation.
c. will pass interest obligations on to future generations with no corresponding benefits.
d. will cause the government to go bankrupt.
B
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Higher inflation is particularly damaging to the real value of
A) wages. B) financial assets. C) physical assets. D) government tax revenues.
Suppose we know that 10 Spanish Galleons sunk in the Atlantic ocean carrying approximately 50 tons of gold, but the exact location of these shipwrecks is unknown. Would this gold add to the world reserve?
A) Yes, we know it exists. B) No, we know it exists but we can't extract the gold. C) Yes, it's only a matter of time before the shipwrecks are discovered. D) No, there are no established property rights over the shipwreck so they cannot add to world reserves..