A decrease in net taxes:
a. increases GDP as much as an equal decrease in government purchases.
b. increases GDP less than an equal increase in government purchases.
c. decreases GDP more than an equal decrease in government purchases.
d. changes GDP in an unpredictable manner.
e. has no effect on GDP.
Question 2
If the total variable cost of producing 5 units of output is 10 and the total variable cost of producing 6 units is 15, the marginal cost of producing a sixth unit is 5.
a. True
b. False
Indicate whether the statement is true or false
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