Figure 11-3

In Figure 11-3, which line represents the change in the consumption schedule caused by a cut in fixed taxes?

Name: Figure 11-3 In Figure 11-3, which line represents the change in the consumption schedule caused by a cut in fixed taxes?
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Question

Figure 11-3

In Figure 11-3, which line represents the change in the consumption schedule caused by a cut in fixed taxes?

Quizplus · Accepted Answer

In graph (a), a cut in fixed taxes causes a movement from C₁ to C₂, indicating an increase in consumption at every level of income. Therefore, option B represents the change in the consumption schedule caused by a cut in fixed taxes.

Figure 11-3 in Figure 11-3, Which Line Represents the Change in the Change