If the Time Path of Government Purchases Does Not Change

question 12

Multiple Choice

If the time path of government purchases does not change and the government cuts lump sum taxes, then:

• A)real GDP does rise.
• B)real consumption does not change.
• C)real gross investment rises.
• D)all of the above.

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Definitions:

Profitability

A financial metric that measures the degree to which a company or a business activity makes money, indicating the efficiency in generating profits.

Economic Condition

The state of a region's or country's economy, reflected in indicators such as GDP, unemployment rates, and inflation.

Wage Structure

The organization and scaling of wages within an organization, setting the relative pay levels for different roles or job grades.

Job Evaluation

A systematic process used to ascertain the relative worth of jobs within an organization to establish a fair and equitable pay structure.