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Which of the Following Is True Regarding Induced Taxes

Question 28

Multiple Choice

Which of the following is true regarding induced taxes?
I. Induced taxes vary with disposable income.
II. Induced taxes cause the multiplier effect to be greater than it would be otherwise.
III. Induced taxes weaken the link between real GDP and disposable income.


A) I, II and III
B) I and II
C) I and III
D) II and III

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