(Last Word) According to the research of Christina Romer and David Romer,
A) a tax reduction of 1 percent of GDP lowers real GDP by roughly 2 to 3 percent.
B) a tax increase of 1 percent of GDP lowers real GDP by roughly 2 to 3 percent.
C) a tax reduction of 2 to 3 percent raises real GDP by roughly 1 percent.
D) a tax increase of 2 to 3 percent lowers real GDP by roughly 1 percent.

Question

Quizplus · Accepted Answer

According to the research of Christina Romer and David Romer, a tax increase of 1 percent of GDP lowers real GDP by roughly 2 to 3 percent. There is no mention of the effect of a tax reduction on real GDP in their research.

(Last Word) According to the Research of Christina Romer and David