"If Congress Cuts Income Taxes, Demand for Output Is Likely

question 105

Multiple Choice

"If Congress cuts income taxes, demand for output is likely to increase" is a ________ statement about ________ policy.

• A)positive; fiscal
• B)normative; fiscal
• C)positive; monetary
• D)normative; monetary

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Definitions:

Direct Method

A cash flow statement preparation approach that lists major classes of gross cash receipts and payments.

Gain

A financial term referring to the positive difference between the sale price of an asset and its original purchase price.

Financing Activities

Transactions that result in changes in the size and composition of the equity capital or borrowings of the company.

Stockholders' Equity

The residual interest in the assets of an entity that remains after deducting its liabilities, representing ownership equity in a corporation.