The tax cuts in 1981 and 1982 did not lead to growth in GDP as did the tax cuts in 1964. One reason for this difference was that
A) the 1981-82 tax cuts concentrated on personal tax cuts, but the 1964 cuts were for both personal and corporate taxpayers.
B) the saving rate increased in 1981-82, but it decreased in 1964.
C) expansionary monetary policy accompanied the 1964 tax cuts, but the 1981-82 cuts were accompanied by restrictive monetary policy.
D) tax indexation was built into the 1981-82 tax-cut program, but in 1964 there was no indexation.
C
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Suppose there is a public good that has market supply characterized by the equation X = (P/3) - (32/3). Suppose further that market demand for this good can be characterized by the equation X = 25 - P. Find the equilibrium quantity of the public good that will be supplied.
What will be an ideal response?
The goal of the firm, according to economists, is to
A. make as much economic profit as is possible. B. grow as large as possible. C. sell as many units of the good it produces as possible. D. stay in business for as long as possible.
Minimum wage is an example of a price ________, and results in a ________ of labor.
A. ceiling; shortage B. ceiling; surplus C. floor; shortage D. floor; surplus
Suppose that a university decides to spend $1 million to upgrade personal computers and scientific equipment for faculty rather than spend $1 million to expand parking for students. This example illustrates
A. distorted priorities. B. increasing opportunity costs. C. opportunity costs. D. productive efficiency.