Multiple Choice
The effect of imposing a lump-sum tax is to
A) reduce the absolute levels of consumption and saving at each level of GDP and to reduce the size of the multiplier.
B) reduce the absolute levels of consumption and saving at each level of GDP but to not change the size of the multiplier.
C) reduce the absolute levels of consumption and saving at each level of GDP and to increase the size of the multiplier.
D) increase the absolute levels of consumption and saving at each level of GDP and to increase the size of the multiplier.
Correct Answer:
Verified
Correct Answer:
Verified
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