A Change in Net Taxes Affects the Equilibrium Quantity of GDP

question 41

Multiple Choice

A change in net taxes affects the equilibrium quantity of GDP demanded_____.

• A)in the same way as a change in government purchases does
• B)in the same way as a change in planned investment does
• C)in the same way as a change in net exports does
• D)only indirectly,changing the level of disposable income
• E)in an unpredictable manner

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Definitions:

Decision Tree Analysis

A graphical technique used for decision-making and risk management, representing different courses of action and their possible outcomes.

Cost Of Capital

The cost of capital represents the required return necessary to make a capital budgeting project, such as building a new factory, worthwhile.

Pure Play

A company that focuses exclusively on a single product or service area.

Risk Characteristics

The inherent features of an investment that determine its potential return and the likelihood of loss.