Which of the Following Policies Is Likely to Generate the Smallest

question 72

Multiple Choice

Which of the following policies is likely to generate the smallest increase in national saving?

• A)an increase in income taxes
• B)an increase in consumption taxes
• C)a cut in government transfer payments
• D)None of the above policies will increase national saving.

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Definitions:

Revenue

The total income generated by a company from its usual business activities, usually from the sale of goods and services to customers.

Spending Variance

A financial metric that indicates the difference between the budgeted or planned amount of spending and the actual amount spent.

Flexible Budget

A budget that is adaptable and varies according to the changes in activity level or volume.

Net Operating Income

The profit generated from a company's core business operations, excluding deductions of taxes and interest.