If the Government Wishes to Increase Its Spending on Goods

question 38

Multiple Choice

If the government wishes to increase its spending on goods and services by $10 billion without increasing the overall level of aggregate demand,it should

• A)increase taxes by $10 billion.
• B)decrease taxes by $10 billion.
• C)increase taxes by more than $10 billion.
• D)increase taxes,but by less than $10 billion.
• E)leave tax receipts unchanged.

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Definitions:

Peptidoglycan

A polymer consisting of sugars and amino acids that forms a mesh-like layer outside the plasma membrane of most bacteria, providing structural strength.

Chitin

A nitrogen-containing structural polysaccharide that forms the exoskeleton of insects and the cell walls of many fungi.

Cellulose

A complex carbohydrate that constitutes the primary cell wall of green plants, providing structural support.

Micronuclei

Small nuclei that form from chromosomal fragments or whole chromosomes not incorporated into one of the main daughter nuclei during cell division.