When a government has decided on a permanent spending increase, a vali

When a government has decided on a permanent spending increase, a valid reason to increase borrowing rather than taxes might be to ________.

A) to avoid an unnecessary stimulus to aggregate demand
B) to shift the burden from domestic taxpayers to foreign bond holders
C) to avoid distortions that might reduce long-run aggregate supply
D) to avoid an increase in income inequality

ANSWER

C