Which of the following would cause the level of income to change by the greatest amount,ceteris paribus?
A) An increase in Social Security payments of $10 billion.
B) A reduction in personal income taxes of $10 billion.
C) An increase in defense spending of $10 billion.
D) All of the other choices have equal impacts on the level of income.
Correct Answer:
Verified
Q54: If the MPC equals 0.80,a $200 billion
Q55: Suppose the government decides to increase taxes
Q56: Assume the MPC is 0.75,taxes increase by
Q57: What happens to aggregate demand when government
Q58: A tax cut
A)Directly decreases the disposable income
Q60: Assume the economy is at full employment
Q61: The fiscal policy target for achieving full
Q62: If the desired fiscal restraint is $80
Q63: If AD excess equals $40 billion and
Q64: The desired fiscal restraint is equal to
A)Excess
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