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In the Short Run, Tax Cuts That Are Intended to Increase

Question 191

Multiple Choice

In the short run, tax cuts that are intended to increase aggregate supply have


A) almost no effect on aggregate demand, and a small effect on aggregate supply.
B) about an equal effect on both aggregate demand and aggregate supply.
C) a much greater effect on aggregate demand than on aggregate supply.
D) almost no effect on aggregate supply, and a negative effect on aggregate demand.

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