The Ricardian Equivalence Theorem States That

question 123

Multiple Choice

The Ricardian equivalence theorem states that

• A)an increase in government spending by the federal government leads to offsetting reductions in state government spending.
• B)an increase in government spending financed by higher taxes has no effect on aggregate demand.
• C)spending on national defense is a direct expenditure offset.
• D)government spending financed by taxes is equivalent to government spending financed by borrowing.

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Definitions:

Pulmonary

Pertaining to the lungs and respiratory system.

Venipuncture

The puncture of a vein as part of a medical procedure, typically to withdraw blood or administer medications.

Phlebotomy

The act of drawing or removing blood from the circulatory system through a cut or puncture to obtain a sample for analysis or therapeutic purposes.

Telangiectasis

A condition characterized by the dilation of small blood vessels near the surface of the skin or mucous membranes, resulting in visible red or purple lines.