According to the Theory of Ricardian Equivalence, If Consumers Are

Multiple Choice

According to the theory of Ricardian equivalence, if consumers are forward-looking, they will view a tax cut combined with no plans to reduce government spending as ______, so their consumption will ______.

A) additional disposable income; increase.
B) additional disposable income; remain unchanged.
C) a rescheduling of taxes into the future; increase.
D) a rescheduling of taxes into the future; remain unchanged.