Suppose There Is a Simultaneous Tax Increase and Open Market

question 60

Multiple Choice

Suppose there is a simultaneous tax increase and open market purchase of bonds. Which of the following must occur as a result of this?

• A) Output increases.
• B) Output decreases.
• C) The interest rate increases.
• D) The interest rate decreases.
• E) Both output and the interest rate increase.

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Definitions:

Anticoagulant

Medications used to prevent blood clots from forming or growing larger in the blood vessels, often used to treat or reduce the risk of cardiovascular diseases.

Vitamin E

A fat-soluble antioxidant vitamin important for maintaining healthy skin and a strong immune system.

Risk for Bleeding

Risk for bleeding denotes a clinical judgment that an individual is at an increased risk of bleeding due to various factors or conditions.

Tissue Integrity

Describes the state of structurally intact and functionally unimpaired cells and tissues in the body.