If people expected that a fiscal policy in the form of a tax cut was temporary, then this policy's effect on the economy would tend to be
A)stronger.
B)weaker.
C)the exact opposite of what was intended.
D)as the multiplier effect would predict.

Question

Quizplus · Accepted Answer

If people expect a tax cut to be temporary, they are less likely to change their spending habits significantly, leading to a weaker effect on the economy compared to a permanent tax cut.

If People Expected That a Fiscal Policy in the Form