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Author Question: In the traditional Keynesian model, an income tax cut raises real GDP because A) consumption ... (Read 55 times)

rlane42

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on: Jun 30, 2018
In the traditional Keynesian model, an income tax cut raises real GDP because
 
  A) consumption spending depends positively on after-tax income.
  B) of the crowding-out effects of taxes.
  C) consumption spending depends negatively on after-tax income.
  D) consumption spending is not related to after-tax income.

Question 2

If the growth rates of nominal GDP and real GDP in an economy are 6 and 2 respectively, the inflation rate in the economy must be:
 
  A) 2. B) 8. C) 4. D) 3.


ynlevi

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Reply #1 on: Jun 30, 2018
Answer to Question 1

A

Answer to Question 2

C


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