Government Tax Policy Can Affect Aggregate Supply as Well as Aggregate

question 6

Multiple Choice

Government tax policy can affect aggregate supply as well as aggregate demand, because changes in taxes change the:

• A) supply of money in the economy.
• B) length of the inside lag of fiscal policy.
• C) incentives to work and invest.
• D) tradeoff between inflation and unemployment.

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Definitions:

Continuous Reinforcement

a method of learning where a behavior is reinforced (rewarded) every time it occurs, facilitating quick acquisition of the behavior.

Partial Reinforcement

A learning theory concept where reinforcement is given only a portion of the time a subject gives the desired response, which enhances the resilience of the response.

Continuous Reinforcement

A learning schedule in which every correct response is followed by a reward, facilitating faster learning.

Gradual Reinforcement

A process in operant conditioning where reinforcement is slowly introduced or varied to shape behavior.