Which of the Following Tends to Make the Size of a Shift

question 214

Multiple Choice

Which of the following tends to make the size of a shift in aggregate demand resulting from a tax change smaller than otherwise?

• A)the multiplier effect
• B)the crowding-out effect
• C)the accelerator effect
• D)the Fisher effect

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Definitions:

Product Market

The marketplace where final goods or services are offered to consumers, businesses, and the government.

Positive

In economics, referring to factual statements or analyses about how the world is, as opposed to normative statements which are about how the world ought to be.

National Defense

The government activities and measures taken to protect a country and its citizens from external and internal threats, including maintaining armed forces and developing defense strategies.

Positive

Characterized by the presence of something rather than its absence; in economics, often used to describe factual statements or analysis.