Multiple Choice
How do transfer payments and taxes affect aggregate spending?
A) Transfer payments and taxes affect aggregate spending directly, just as consumption does.
B) Transfer payments and taxes affect aggregate spending indirectly, by first changing disposable income and thereby changing consumption.
C) Transfer payments and taxes do NOT affect aggregate spending.
D) Transfer payments and taxes affect aggregate spending indirectly, by first changing national income and thereby changing consumption.
Correct Answer:

Verified
Correct Answer:
Verified
Q92: Exhibit 11-3<br> <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB4905/.jpg" alt="Exhibit 11-3
Q93: Exhibit 11-2<br> <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB4905/.jpg" alt="Exhibit 11-2
Q94: How is aggregate expenditure affected when net
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Q98: Suppose the economy is experiencing an expansionary
Q99: Which of the following best describes the
Q100: Assume autonomous net taxes fall by $300,
Q101: Suppose the economy is already producing at
Q102: Exhibit 11-2<br> <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB4905/.jpg" alt="Exhibit 11-2