In a Simple Macro Model with a Constant Price Level,a

question 9

Multiple Choice

In a simple macro model with a constant price level,a decrease in the net tax rate causes the AE curve to

• A)shift parallel downward.
• B)shift parallel upward.
• C)rotate downward.
• D)rotate upward.
• E)remain stationary.

---

Definitions:

Proximate Cause

A legal concept that refers to the primary cause of an injury or damage, determining liability based on the directness of the relationship between the action and the harm.

Intervening Cause

An event that occurs after a defendant's act, significantly contributing to an outcome or damage, thus potentially relieving the defendant of liability.

Actual Cause

The direct reason or factor that produces an effect, leading to a specific outcome or event.

Reasonableness of Risk

The assessment of whether the risk of harm in a situation is justified under the circumstances.