If income tax rate increases:
A) disposable income decreases, spending decreases and GDP decreases.
B) budget balance improves, spending increases and GDP increases.
C) budget balance deteriorates, spending increases and GDP increases
D) disposable income increases, spending increases and GDP increases.
Correct Answer:
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Q5: Which of the following is false?
A) AE=C+I+G+X-Z.
B)
Q6: If the MPC is 0.8 out of
Q7: When government spending increases and taxes do
Q8: An equilibrium income in an open economy
Q9: Other things remaining the same, an increase
Q11: Other things constant, if the government imposes
Q12: Assume that the MPC out of disposable
Q13: A $1 increase in government spending will
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