Which of the following is correct?
a. Well designed tax cuts can increase investment which fluctuates more than consumption over the business cycle.
b. Well designed tax cuts can increase investment but it fluctuates less than consumption over the business cycle.
c. Tax cuts have little effect on investment which fluctuate more than consumption over the business cycle.
d. Tax cuts have little effect on investment but it fluctuates less than consumption over the business cycle
a
You might also like to view...
Which of the following is not one of the key services provided by the financial system?
A) risk sharing B) liquidity C) decreasing taxes D) generating information
Markets are generally more effective at providing? ________ and governments are most effective at providing? ________.
A) pure public goods; common pool resources
B) pure private goods; pure public goods
C) common pool resources; club goods
D) club goods; pure private goods
When deciding on an appropriate course of action to counter a recessionary gap, which of the following do policymakers consider?
A. The slope of the short-run Phillips curve B. The costs of inflation and unemployment C. The efficiency of the economy’s self-correcting mechanism D. All of these responses are correct.
What is measured on the vertical axis of the aggregate demand graph?
A) unemployment B) nominal income C) the price level D) real GDP per year