In the graph above, tax revenues vary:
A) Directly with the level of GDP
B) Inversely with the level of GDP
C) Directly with the level of government spending
D) Inversely with the level of government spending

Question

In the graph above, tax revenues vary:
A) Directly with the level of GDP 
B) Inversely with the level of GDP 
C) Directly with the level of government spending 
D) Inversely with the level of government spending

Quizplus · Accepted Answer

The graph shows a positive slope, indicating that as the level of GDP increases, tax revenues also increase. Therefore, tax revenues vary directly with the level of GDP.

In the Graph Above, Tax Revenues Vary