A Rise in MPC Makes the Total Expenditures (TE)curve __________

question 155

Multiple Choice

A rise in MPC makes the total expenditures (TE) curve __________ and __________ the multiplier.

• A) steeper; raises
• B) steeper; lowers
• C) flatter; raises
• D) flatter; lowers

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Definitions:

Net Pay

The amount of an employee's earnings after all deductions, such as taxes and retirement contributions, have been withheld.

Social Security Tax

A mandatory contribution paid by employees and employers to the government, intended to fund the Social Security program that provides benefits for retirees, disabled individuals, and survivors.

FUTA Tax

Federal Unemployment Tax Act tax, which is a payroll tax paid by employers to fund the government's unemployment insurance program.

SUTA Tax

The State Unemployment Tax Act tax, a payroll tax that employers pay to fund the state's unemployment insurance.