If a Lump-Sum Tax of $40 Billion Is Imposed and the MPC

question 112

Multiple Choice

If a lump-sum tax of $40 billion is imposed and the MPC is 0.6, the saving schedule will:

• A)shift downward by $24 billion.
• B)shift upward by $24 billion.
• C)shift downward by $16 billion.
• D)shift upward by $16 billion.

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Definitions:

Mixed Bundling

Selling two or more goods both as a package and individually.

Hook-up Fee

A charge for connecting to a service or utility, such as electricity, water, or the internet.

Two-part Tariff

A pricing strategy that consists of a fixed fee plus a variable usage rate, commonly used in utility services and memberships.

Pay-per-view

A type of television or online streaming service where viewers pay a fee to watch a specific program or event.