In the late 1990s, debt-financed government spending decreased in Mexico. Following this decrease, consumption spending increased. Ricardian equivalence would explain this increase in consumption as the result of:
a. people's expectation of higher future taxes required to pay off government debt.
b. people's expectation of lower future taxes that induce them to save less.
c. automatic stabilization of the economy.
d. the crowding out effect.
e. an increase in current household disposable income.
b
Economics
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The fact that there are too few resources to satisfy all our wants is attributed to
A. Greed. B. Lack of money. C. Shortages. D. Scarcity.
Economics
Refer to the information provided in Figure 2.4 below to answer the question(s) that follow.
Figure 2.4According to Figure 2.4, Point A necessarily represents
A. only hybrid cars being produced. B. an unattainable production point. C. what society wants. D. the economy's optimal production point.
Economics