Which of the following statements about taxation is true?
A) A tax cut would affect aggregate demand directly.
B) A tax cut would raise income and expenditures.
C) Cutting taxes by $20 is the same as increasing government spending by $20.
D) A change in taxes would not affect consumption.
E) An increase in taxes by $50 acts to lower aggregate demand by $50.
Correct Answer:
Verified
Q8: When the price level increases, the effect
Q9: Figure 13.1 Q10: If the price level _ as real Q11: According to the Employment Act of 1946, Q12: If aggregate demand intersects aggregate supply in Q14: Taxes affect aggregate demand Q15: Government spending equals the sum of these Q16: If the government wants to close a Q17: To close a GDP gap, government should Q18: The effect of an increase in government
A) indirectly by changing
A)
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