How Does a Change in Taxes Primarily Affect Aggregate Demand

question 1

Multiple Choice

How does a change in taxes primarily affect aggregate demand?

• A)a tax change alters disposable income and consumption spending
• B)a tax change alters exports and net exports
• C)a tax change alters investment by an equal and opposite amount
• D)a tax change alters government purchases by an equal amount

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Definitions:

Compare

Typically refers to a method or function that assesses two values or objects and determines their ordering or if they are equal.

Control Structure

The blocks in programming that analyze variables and choose directions in which to go based on given parameters.

Two-Way Selection

A control structure in programming that allows for two possible paths of execution based on a condition being true or false.

If Statements

Conditional statements that execute a block of code if a specified condition evaluates to true.