According to the Traditional Keynesian Analysis, If the Government Increases

question 195

Multiple Choice

According to the traditional Keynesian analysis, if the government increases spending and pays for all of it by raising current taxes, then

• A) aggregate demand will decrease.
• B) a budget deficit will occur.
• C) a budget surplus will occur.
• D) aggregate demand will increase.

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Definitions:

Taxable Income

The amount of an individual's or corporation's income used to determine how much tax is owed to the government in a given tax year.

Schedule L

Schedule L is a tax form used by certain businesses to report their balance sheet details to the IRS, including assets, liabilities, and equity.

Schedule M-1

A form used by corporations filing U.S. federal corporate income taxes to reconcile financial statement income with tax return income.

Total Receipts

The total amount of money received by a business during a specific period, including sales, income, donations, and other forms of revenue.