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If Households View a Tax Cut as Temporary, Then the Tax

Question 56

Multiple Choice

If households view a tax cut as temporary, then the tax cut


A) has no effect on aggregate demand.
B) has more of an effect on aggregate demand than if households view it as permanent.
C) has the same effect as when households view the cut as permanent.
D) has less of an effect on aggregate demand than if households view it as permanent.

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