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Suppose Y=400 and the Government's Net Tax Rate Is 10

Question 14

Multiple Choice

Suppose Y=400 and the government's net tax rate is 10 percent. If we are told that the government has a budget surplus, then government purchases must be


A) greater than 30.
B) greater than 40.
C) less than 40.
D) less than 30.
E) -- not enough information to know.

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