The Taxation Multiplier Tells Us

question 137

Multiple Choice

The taxation multiplier tells us:

• A)the amount by which GDP increases when government spending increases by $1.
• B)tells us the amount GDP decreases when taxes increase by $1.
• C)the fraction of each tax dollar that will increase GDP when consumers spend $1.
• D)the amount by which government spending increases when GDP increases by $1.

---

Definitions:

Coalescence

The process of coming together to form one mass or whole, often used to describe the unity of groups or ideas.

Evolutionary Theory

A scientific explanation for the diversity of life on Earth, indicating how species change over generations through processes like natural selection and genetic drift.

Youth Crime

Illegal activities committed by individuals who are legally considered minors.

Secondary School

An educational institution for adolescents, typically following primary or elementary education and preceding tertiary or vocational education.