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    Principles of Macroeconomics Study Set 8
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    Exam 23: Six Debates Over Macroeconomic Policy: Should the Tax Laws Be Reformed to Encourage Saving
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    If a Reduction in Taxes on Savings Reduced the Amount
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If a Reduction in Taxes on Savings Reduced the Amount

Question 36

Question 36

Multiple Choice

If a reduction in taxes on savings reduced the amount of private saving,then the


A) income effect equaled the substitution effect.
B) income effect outweighed the substitution effect.
C) the substitution effect outweighed the income effect.
D) None of the above.

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