The Ricardian Equivalence Proposition Suggests That a Government Deficit Caused

question 7

Multiple Choice

The Ricardian equivalence proposition suggests that a government deficit caused by a tax cut

• A)causes inflation.
• B)causes a current account deficit.
• C)raises interest rates.
• D)doesn't affect consumption.

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Definitions:

Stress Response

The body's reaction to any demand or threat, activating physiological changes to face the challenge.

Emotion of Anger

A strong feeling of annoyance, displeasure, or hostility.

Fight

A confrontation or struggle between individuals or groups, often involving physical violence or arguments.

Flee

To run away from a place or situation of danger.