A cut in marginal tax rates, all other things constant, would:
A) increase the price level and decrease real gross domestic product in the short run if it has no effect on short-run aggregate supply.
B) increase the price level and real gross domestic product in the short run, even if possible aggregate supply effects are included.
C) increase real gross domestic product in the short run, but there is an indeterminate effect on the price level if there are no supply-side effects on aggregate supply.
D) increase real gross domestic product in the short run, but there is an indeterminate effect on the price level if the supply-side effects on aggregate supply are included.
E) decrease the price level in the short run, but the effect on real gross domestic product is indeterminate if supply-side effects are included.
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