The Theory That Government Borrowing May Function Like an Increase

question 228

Multiple Choice

The theory that government borrowing may function like an increase in taxes, that is, reducing current consumption and business expenditures, is known as

• A)the marginal propensity to consume.
• B)the Ricardian equivalence theorem.
• C)planned tax policy.
• D)Congressional Tax policy.

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Definitions:

Reality

The state of things as they actually exist, outside of perception or interpretation.

Perceptual Set

A tendency to perceive or notice some aspects of the available sensory data and ignore others, influenced by expectation or prior experience.

Facial Image

A visual representation of a person's face, often used for identification purposes.

Masking Stimulus

A noise or signal used in sensory experiments to interfere with or "mask" the perception of another stimulus, to study sensory thresholds and attention.