Why Does a Tax Change Affect Aggregate Demand

question 40

Multiple Choice

Why does a tax change affect aggregate demand?

• A) A tax change alters saving by an equal amount.
• B) A tax change alters imports and net exports.
• C) A tax change alters government spending by an equal amount.
• D) A tax change alters disposable income and consumption spending.

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Definitions:

Ethnocentric

Having or based on the belief that one's own ethnic group is superior, or judging other cultures solely by the values and standards of one's own culture.

Group-Related Customs

Traditions, habits, or behaviors that are developed, shared, and practiced by a specific group to signify membership or allegiance.

Collectivist Approach

A cultural orientation that prioritizes the group over individual goals and values collaboration and interdependence.

Gender Communication Styles

The distinct ways in which men and women express themselves and interpret messages, often influenced by societal norms and individual experiences.