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Macroeconomics 2nd Edition by Campbell McConnell ,Stanley Brue,Sean Flynn
Edition 2ISBN: 978-0077416409Macroeconomics 2nd Edition by Campbell McConnell ,Stanley Brue,Sean Flynn
Edition 2ISBN: 978-0077416409 Exercise 9
Refer to the accompanying table for Waxwania: L02, LO3
a. What is the marginal tax rate in Waxwania? The average tax rate? Which of the following describes the tax system: proportional, progressive, regressive?
b. Suppose Waxwania is producing $600 of real GDP, whereas the potential real GDP (or full-employment real GDP) is $700. How large is its budget deficit? Its cyclically-adjusted budget deficit? Its cyclically-adjusted budget deficit as a percentage of potential real GDP? Is Waxwania's fiscal policy expansionary or is contractionary?
a. What is the marginal tax rate in Waxwania? The average tax rate? Which of the following describes the tax system: proportional, progressive, regressive?b. Suppose Waxwania is producing $600 of real GDP, whereas the potential real GDP (or full-employment real GDP) is $700. How large is its budget deficit? Its cyclically-adjusted budget deficit? Its cyclically-adjusted budget deficit as a percentage of potential real GDP? Is Waxwania's fiscal policy expansionary or is contractionary?
Explanation
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The data table is reproduced below: 
a. ...
Macroeconomics 2nd Edition by Campbell McConnell ,Stanley Brue,Sean Flynn
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