Answer the following statements true (T) or false (F)
1. Raising taxes in order to pay off the U.S. national debt would result in a significant redistribution of income.
2. Passing the debt on to future generations has a different impact on individuals than it does on the total economy.
3. Reducing the national debt would increase the money supply.
4. The actual deficit is a poor measure of fiscal policy.
5. The U.S. national debt has declined continuously as a percentage of GDP since World War II.
1. TRUE
2. TRUE
3. FALSE
4. TRUE
5. FALSE
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If there is increasing opportunity cost, then when moving downward on a production possibilities frontier, the opportunity cost of the good on the horizontal axis ________ as more of the good is produced
A) increases and the PPF gets steeper B) increases and the PPF gets flatter C) decreases and the PPF gets steeper D) decreases and the PPF gets flatter E) does not change and the PPF gets steeper
What is a multiplier? How does the multiplier effect occur?