Assume that the RBA is expected to respond to any event by keeping output constant (i.e., equal to its initial level). An unexpected increase in taxes will cause:
A) stock prices to fall.
B) stock prices to rise.
C) no change in stock prices.
D) an ambiguous effect on stock prices.
E) stock prices to rise only if goods prices rise.

Question

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The Answer of Assume that the RBA is expected to respond to any event by keeping output constant (i.e., equal to its initial level). An unexpected increase in taxes will cause:
A) stock prices to fall.
B) stock prices to rise.
C) no change in stock prices.
D) an ambiguous effect on stock prices.
E) stock prices to rise only if goods prices rise.

Assume That the RBA Is Expected to Respond to Any