Multiple Choice
Let taxes be fixed and equal to T, consumption given by
C = a + bY - T) , investment and government spending exogenous, and net exports described by X = g - mY. The multiplier for T would then be
A) 1/[1 - 1 - t) b + m].
B) b/[1 - 1 - t) b + m].
C) b/1 - b + m) .
D) -1/[1 - 1 - t) b + m].
E) -b/1 - b + m) .
Correct Answer:
Verified
Correct Answer:
Verified
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