Suppose the government's initial debt is 400 billion. If for the next three years the government runs deficits of 150, 125, and 200 billion, the government's additional debt at the end of the three years will be
A) -50 billion. B) 50 billion. C) 475 billion. D) 900 billion.
Question 2
The idea that policy actions have no real effects in the short run if they are anticipated and no real effects in the long run is called the
A) adaptive proposition. B) activism proposition.
C) Keynesian proposition. D) policy irrelevance proposition.
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