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Author Question: Multiplier Effects of Transfer Payments and TaxesAssume the tax multiplier is -6.5 and a $400 ... (Read 36 times)

bubba123

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Multiplier Effects of Transfer Payments and Taxes

Assume the tax multiplier is -6.5 and a $400 billion tax increase is implemented. Holding everything else constant including the price level, what is the change in GDP?
◦ a $0.016 billion decrease in GDP
◦ a $2600 billion increase in GDP
◦ a $0.016 billion increase in GDP
◦ a $2600 billion decrease in GDP


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Marked as best answer by bubba123 on Nov 23, 2022

bmac98

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bubba123

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Reply 2 on: Nov 23, 2022
Thanks for the timely response, appreciate it


duy1981999

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Reply 3 on: Yesterday
Great answer, keep it coming :)

 

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