The Basic Point of Generational Accounting Is That High and Rising

question 73

Multiple Choice

The basic point of generational accounting is that high and rising debt-GDP ratios imply:

• A) higher interest rates in the future.
• B) lower tax rates on future generations.
• C) higher tax rates on future generations.
• D) reduced government expenditures in the future.
• E) rising government expenditures in the future.

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Definitions:

Equity Beta

A measure of a stock's volatility relative to the overall market volatility.

Business Risk

The equity risk that comes from the nature of the firm’s operating activities.