Suppose the Net Taxes on the Quantity of Real GDP

question 14

Multiple Choice

Suppose the net taxes on the quantity of real GDP demanded changes.How would this change be expressed?  

• A) as a shift in the consumption function times the marginal propensity to consume 
• B) as a shift in the consumption function times the marginal propensity to save 
• C) as a shift in the consumption function times the autonomous net tax multiplier 
• D) as a shift in the consumption function times the simple spending multiplier

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