Multiple Choice
Assume that nobody cares about the economic well-being of future generations. Then the Ricardian equivalence view of the effect of debt-financed tax cuts is:
A) totally invalid.
B) still fully valid because the government has the option to levy taxes to pay off the full debt in just a few years.
C) still fully valid as long as the government cuts spending also.
D) still partially valid because most of the taxpayers will live and pay taxes for a substantial number of years after the tax cut.
Correct Answer:
Verified
Correct Answer:
Verified
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