When the government reduces taxes,all other things being equal,which of the following decrease?
A)consumption
B)take-home pay
C)household saving
D)government surplus

Question

Quizplus · Accepted Answer

When the government reduces taxes, the government surplus decreases as they are collecting less revenue. A, B, and C are incorrect as they would typically increase as people have more disposable income and are more likely to consume, take home more pay, and save less. However, other factors such as interest rates and consumer confidence can also influence these variables.

When the Government Reduces Taxes,all Other Things Being Equal,which of the Following