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The Romer and Romer Paper, "The Macroeconomic Effects of Tax

Question 195

Multiple Choice

The Romer and Romer paper, "The Macroeconomic Effects of Tax Changes: Estimates Based on a New Measure of Fiscal Shocks," found that tax changes that are made to promote long-run growth
Or to reduce an inherited budget deficit tend to result in


A) a strong positive relationship between taxes and output GDP.
B) a weak positive relationship between taxes and output GDP.
C) an uncertain correlation between taxes and output GDP.
D) a strong negative relationship between taxes and output GDP.

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