The government runs an experiment where a random sample of 200 adults over 40 get a 5% tax cut and a random sample of 200 adults under 40 get no tax cut. Their results show that spending, on average, increased 8% with a 5% tax cut. They conclude that a 5% tax cut for all adult Americans will increase spending by 8%. Why is this logic flawed?
A) The effect of the treatment on the treated may not be the average treatment effect.
B) A 5% tax cut for all Americans suffers from selection bias.
C) The measured effect of the treatment on the treated may be biased.
D) The logic is not flawed.

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The Answer of The government runs an experiment where a random sample of 200 adults over 40 get a 5% tax cut and a random sample of 200 adults under 40 get no tax cut. Their results show that spending, on average, increased 8% with a 5% tax cut. They conclude that a 5% tax cut for all adult Americans will increase spending by 8%. Why is this logic flawed?
A) The effect of the treatment on the treated may not be the average treatment effect.
B) A 5% tax cut for all Americans suffers from selection bias.
C) The measured effect of the treatment on the treated may be biased.
D) The logic is not flawed.

The Government Runs an Experiment Where a Random Sample of 200