Multiple Choice
If the government cuts taxes today,issuing debt today and repaying the debt plus interest next year,a rational taxpayer will
A) spend the full amount of the tax cut today and reduce consumption next year.
B) increase consumption today, before taxes go up next year.
C) increase saving today, leaving consumption unchanged.
D) leave a smaller gross bequest to her or his heirs.
Correct Answer:
Verified
Correct Answer:
Verified
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