The Demand- Side Effect of a Change in Taxes Is

question 65

Multiple Choice

The demand- side effect of a change in taxes is less than the same sized change in government expenditure because

• A)changes in government expenditure do not directly affect consumption.
• B)the amount by which taxes change is affected by the MPC.
• C)only part of the increase in disposable income from the tax cut is spent.
• D)tax rates are the same regardless of income levels.

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Definitions:

Genotype

Genotype describes the genetic makeup of an individual. Although a genotype includes all the alleles of all the genes in that individual, the term is often used to refer to the specific alleles carried by an individual for any particular gene.

Natural Selection

The process by which individuals with characteristics suited to their environment are more likely to survive and reproduce, thereby influencing the genetic makeup of populations.

Linkage Disequilibrium

The non-random association of alleles at two or more loci, not necessarily on the same chromosome, that can arise from historical mutations, genetic drift, or population structure.

Recombination

A genetic process resulting in a mixture of parental characteristics in offspring due to the exchange of genetic material between chromosomes during sexual reproduction.