A decrease in the marginal income tax rate is a fiscal policy which will increase aggregate demand.

Name: A decrease in the marginal income tax rate is a fiscal policy which will increase aggregate demand.
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Question

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When marginal income tax rates decrease, people and businesses have more disposable income. This may lead to an increase in consumption, investment, and overall economic activity, which results in an increase in aggregate demand.

A Decrease in the Marginal Income Tax Rate Is a Fiscal