Figure 11-3

-In Figure 11-3,which line represents the change in the consumption schedule caused by a cut in fixed taxes?
A) C1 in graph (a)
B) C2 in graph (a)
C) C1 in graph (b)
D) C2 in graph (b)

Question

Figure 11-3
 
-In Figure 11-3,which line represents the change in the consumption schedule caused by a cut in fixed taxes?
A) C1 in graph (a) 
B) C2 in graph (a) 
C) C1 in graph (b) 
D) C2 in graph (b)

Quizplus · Accepted Answer

A cut in fixed taxes increases disposable income, leading to an upward shift in the consumption schedule, which is represented by C2 in graph (a).

Figure 11-3 -In Figure 11-3,which Line Represents the Change in the Consumption