Which of the Following Is a Basic Assumption of the Ricardian

question 36

Multiple Choice

Which of the following is a basic assumption of the Ricardian equivalence theorem?

• A)Consumers pay no attention to government budget deficits.
• B)Consumers think only in terms of the present.
• C)If current tax cuts result in budget deficit increases, aggregate supply falls.
• D)Consumers consider future tax payments when deciding how much to spend and save today.

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Definitions:

Lightning Protectors

Devices designed to protect electrical equipment and systems from damage caused by lightning strikes, diverting the surge to the ground.

High Resistance

An electrical characteristic where a material or device opposes the flow of electric current, resulting in less current flow for a given voltage.

Selenium

An element that exhibits photosensitive properties. Its resistance changes inversely with illumination.

Semiconductor

A material with electrical conductivity between that of a conductor and an insulator, used in most electronic devices.