The federal government's principal tool in altering consumer spending is changing
A)corporate income taxes.
B)federal sales taxes.
C)unemployment insurance benefits.
D)personal income tax rates.

Question

Quizplus · Accepted Answer

The federal government's principal tool in altering consumer spending is changing personal income tax rates. By increasing or decreasing personal income tax rates, the government can influence how much disposable income consumers have for spending and saving. A decrease in tax rates will provide consumers with more disposable income, potentially leading to increased spending and economic growth, while an increase in tax rates will reduce disposable income and potentially lead to decreased spending and economic contraction.

The Federal Government's Principal Tool in Altering Consumer Spending Is