The Adoption of an Investment Tax Credit in a Small

question 94

Multiple Choice

The adoption of an investment tax credit in a small open economy is likely to lead to:

• A)no change in either domestic investment or domestic saving.
• B)an increase in both domestic investment and domestic saving.
• C)an increase in domestic saving but no change in domestic investment.
• D)an increase in domestic investment but no change in domestic saving.

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Definitions:

Punishment

The imposition of a penalty as retribution for an offense, with the intention of discouraging undesirable behavior.

External Locus

The belief that one's outcomes or fate are controlled by external forces or the environment, as opposed to internal factors or personal effort.

African American

An ethnic group of Americans with total or partial ancestry from any of the black racial groups of Africa.

Guidance

Support or advice provided to someone to make decisions or to face problems or challenges.