Which of the Following Will Increase Macroeconomic Equilibrium Prices

question 102

Multiple Choice

Which of the following will increase macroeconomic equilibrium prices?

• A)a decrease in government spending.
• B)a decrease in productivity.
• C)an increase in taxes.
• D)a decrease in input prices.

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Definitions:

Tax Loss Carryovers

Provisions that allow taxpayers to use a taxable loss in one period to offset taxable income in future periods.

Depreciation Tax Shield

The reduction in income tax expense realized from the ability to deduct depreciation expenses, thus lowering taxable income.

Marginal Tax Rates

The rate of tax applied to the next dollar of taxable income, which varies depending on income level and filing status in a progressive tax system.

Lease Payments

Regular payments made by a lessee to a lessor for the use of some asset.