The Magnitude of the Tax Multiplier Is Smaller Than the Magnitude

question 178

Multiple Choice

The magnitude of the tax multiplier is smaller than the magnitude of the government expenditure multiplier because

• A)a change in taxes does not change expenditures.
• B)an increase in taxes decreases expenditures.
• C)a decrease in government expenditure decreases tax revenue.
• D)a change in taxes does not change expenditures by as much as the same size change in government expenditure.
• E)a change in taxes creates additional induced taxes.

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Definitions:

Employee Motivation

The level of commitment, drive and energy that a company's workers bring to their jobs.

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Individuals or groups that have an interest in the success and decisions of an organization, including employees, customers, investors, and suppliers.

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A personal stake or concern in an outcome, which could be financial, emotional, or professional.

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Task performance involves the execution of actions necessary to complete a specified job or responsibility effectively.