An increase in taxes in an economy, other things constant, will:
A) decrease unemployment in the economy in the long run
B) decrease the price level in the economy in the long run
C) increase real output in the economy in the long run.
D) create an inflationary gap in the economy
E) create a recessionary gap in the economy.
Correct Answer:
Verified
Q41: A decrease in government purchases, other things
Q42: A reduction in taxes, combined with an
Q43: The figure below shows the aggregate demand
Q44: Suppose the federal government buys $10 million
Q45: Expansionary fiscal policy will result in _
Q47: If the government wants to decrease the
Q48: An expansionary fiscal policy consists of:
A)increased taxes
Q49: If the marginal propensity to consume is
Q50: Contractionary fiscal policy consists of a(n):
A)increase in
Q51: Assume the marginal propensity to consume (MPC)
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