A decrease in net taxes at a given price level leads to
A) no change in aggregate demand.
B) an increase in aggregate demand.
C) a decrease in aggregate demand.
D) a decrease in aggregate supply.
Answer: B) an increase in aggregate demand.
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When firms differentiate their products, they
a. always create real differences among products b. usually strain the sales staff of the firm c. frequently create artificial or superficial differences among products, thus raising their production costs d. always increase their profits
As market price increases in the short run, a profit-maximizing firm in a perfectly competitive market will expand output along its:
A. marginal cost curve. B. average total cost curve. C. average variable cost curve. D. market demand curve.
Using a model of supply and demand for the dollar-pound market, where the horizontal axis is labeled quantity of British pounds, explain what happens when Americans have an increased demand for British automobiles.
What will be an ideal response?
Nations with single payer systems typically have
A. higher tax rates than exist in the U.S. B. better access to high-tech medical solutions than in the U.S. C. serious inequality in the access to basic care. D. lower life expectancies than in the U.S.