Suppose Autonomous Net Taxes Equal $1 Trillion at All Levels

question 6

Multiple Choice

Suppose autonomous net taxes equal $1 trillion at all levels of real GDP.What can be safely assumed about net taxes?  

• A) They are autonomous. 
• B) They are equal to transfer payments. 
• C) They depend on the level of real GDP. 
• D) They equal zero when GDP equals zero.

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Definitions:

Effective

Producing a desired or intended result, often used in contexts relating to efficiency, productivity, or the power to produce a specified effect.

Payee

The individual or entity to whom a payment is directed or owed.

Situation

This is a general term that describes a set of circumstances, context, or condition in which people find themselves or events occur.

Claims in Recoupment

Legal claims made to offset or reduce the asserted losses due to the defendant's breach of a contract.