In a Small Country,the Effect of a Given Change in Government

question 51

Multiple Choice

In a small country,the effect of a given change in government spending

• A)on output is large and the effect on the trade balance is small.
• B)on output is large and the effect on the trade balance is large.
• C)on output is small and the effect on the trade balance is small.
• D)on output is small and the effect on the trade balance is large.

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Definitions:

Tax Bracket

A range of incomes taxed at a particular rate, which forms part of a progressive taxation system where tax rates increase with income.

Cost-Cutting

The process of reducing expenses to improve profitability without compromising the core activities of an organization.

Depreciated Straight-Line

A method of allocating the cost of a tangible asset over its useful life, resulting in a consistent expense amount each period.

Pre-tax Salvage Value

The estimated value of an asset at the end of its useful life before taxes are taken into account.