If Taxes Depend on Income, Then the Magnitude of the Government

question 307

Multiple Choice

If taxes depend on income, then the magnitude of the government spending multiplier ________ it would be if taxes were a lump-sum amount.

• A) could be either larger than or smaller than
• B) is larger than
• C) is equal to what
• D) is smaller than

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Definitions:

Variation

The degree to which data points in a statistical distribution or data set diverge from the average or mean.

Degrees of Freedom

The number of independent values or quantities which can be assigned to a statistical distribution, minus the number of parameters estimated.

Number of Treatments

The total count of distinct experimental conditions applied in research to assess their effects on outcomes.

MSB

Marginal Social Benefit; the additional benefit to society from one more unit of a good or service being produced and consumed.