Question 21 (1 point) Suppose the U.S. government decides to pay off all of its

Question

Question 21 (1 point)

Suppose the U.S. government decides to pay off all of its debt. Which of the following would NOT be a consequence of that action?

Question 21 options:

Inflation would go up because the government must print money in order to repay its debt.

Income would be redistributed to the poor, because lower-income individuals tend to own more government bonds than the average taxpayer.

People would need to find new places to put their savings that were previously in government bonds.

Foreigners, who are not taxpayers, would gain at the expense of U.S. taxpayers.

Inflation would go up because the government must print money in order to repay its debt.

Income would be redistributed to the poor, because lower-income individuals tend to own more government bonds than the average taxpayer.

People would need to find new places to put their savings that were previously in government bonds.

Foreigners, who are not taxpayers, would gain at the expense of U.S. taxpayers.

Explanation / Answer

Debt can be paid off by increasing tax and decreasing govt spending so its unlikely that if US decides to pay off all of its debt Income would be redistributed to the poor, because lower-income individuals tend to own more government bonds than the average taxpayer.

Related Questions

Navigate

• Browse (All)
• Browse Q
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.