A $10 Billion Reduction in Taxes Increases Real GDP by $60

question 81

Multiple Choice

A $10 billion reduction in taxes increases Real GDP by $60 billion.Assuming a constant price level,what does the tax multiplier equal?

• A) 70
• B) 6
• C) 50
• D) 0.17
• E) 0.83

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Definitions:

Anticompetitive

Actions or practices that unfairly limit competition in a market, often regulated by antitrust laws.

Merger

A merger is the combination of two or more companies into a single entity, often to achieve greater efficiencies and market share.

Clayton Act

A U.S. antitrust law, passed in 1914, aimed at preventing anticompetitive practices and monopolies by regulating specific business activities.

Anticompetitive Effect

Refers to actions that negatively affect competition in a market, including practices like monopoly, price fixing or others that hinder free competition.