If a change in the tax laws leads to a $100 billion decrease in tax revenue,then aggregate demand
A) increases by $100 billion.
B) decreases by more than $100 billion.
C) increases by more than $100 billion.
D) decreases by $100 billion.
E) increases by less than $100 billion.
Correct Answer:
Verified
Q25: The magnitude of the tax multiplier is
Q39: The magnitude of the government expenditure multiplier
Q40: The balanced budget multiplier is based on
Q49: Ignoring any supply-side effects, if government expenditure
Q76: If the economy has a structural deficit
Q79: If the government reduces expenditure on goods
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents