Choose the Correct Statement

question 58

Multiple Choice

Choose the correct statement.

• A)Tax cuts increase aggregate supply and aggregate demand.
• B)Tax cuts strengthen the incentive to work and to invest.
• C)The tax multiplier becomes smaller as time passes.
• D)According to Barro and Uhlig, tax cuts are a less powerful way to stimulate real GDP than spending increases.
• E)Both A and B are correct.

---

Definitions:

Contracts

Legally enforceable agreements between two or more parties that create mutual obligations.

Assignee

The party to whom rights or properties are transferred in an agreement or by legal means.

Obligor

An obligor is an individual or entity legally obliged to provide a benefit or payment to another under the terms of a contract.

Assignment

The transfer of rights, property, or obligations from one party to another, often seen in contractual and legal contexts.