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A Greater Reduction in the Government's Deficit Spending Would Stimulate

Question 16

Multiple Choice

A greater reduction in the government's deficit spending would stimulate investment if it were achieved by which of the following changes, ceteris paribus?


A) an increase in the income tax rate on interest payments
B) a decrease in the income tax rate on transfer payments
C) an increase in sales taxes on consumption goods
D) a decrease in sales taxes on consumption goods

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