If Economists Forecast an Increase in Aggregate Expenditure,which of the Following

question 198

Multiple Choice

If economists forecast an increase in aggregate expenditure,which of the following is likely to occur?

• A)GDP will rise.
• B)GDP will fall.
• C)Wages will fall.
• D)Inventories will rise.

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Definitions:

Taxable Income

The portion of an individual's or business's income used to determine how much tax will be owed to the federal government.

Marginal Tax Rate

The percentage of tax applied to an individual's or entity's income for each additional unit of income.

Taxable Income

The amount of income used to calculate how much tax an individual or a company owes to the government in a given tax year.

Progressive Tax

A tax system in which the tax rate increases as the taxable amount increases, typically imposing higher rates on those with higher incomes.