The Following Are Important Problems Associated with the Public Debt

question 4

Multiple Choice

The following are important problems associated with the public debt, except:

• A) Payments of interest on the debt lead to greater income inequality
• B) Interest payments on the debt tend to reduce economic incentives to work and invest
• C) Government borrowing to finance the debt may lead to too much private investment
• D) Payment of interest on the debt held by foreigners would send real resources abroad

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Definitions:

Cognitive Psychologists

Specialists in the field of psychology who study mental processes such as perception, memory, thought, and problem-solving.

Temporary Change

A modification or alteration that is not permanent, often expected to revert back to the original state after a certain period or under specific conditions.

Organism's Behavior

The observable actions or reactions of living entities in response to external or internal stimuli.

Systematic Desensitization

A behavior therapy used to reduce phobic and anxiety responses through gradual exposure to the feared stimulus, paired with relaxation exercises.