A Tax Rebate,which Is Expected to Be Offered in This

question 61

Multiple Choice

A tax rebate,which is expected to be offered in this and all future years,will

• A)have a small positive effect on consumption and aggregate demand.
• B)have no effect on consumption and aggregate demand.
• C)have a significant positive effect on consumption and aggregate demand,with aggregate demand growing by a multiple of the tax rebate.
• D)increase aggregate supply and aggregate demand.

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Definitions:

Matching Principle

An accounting principle that dictates that expenses should be recorded in the same period as the revenues that are generated as a result of those expenses, to accurately represent the financial performance of a company.

Depreciation

The accounting method of allocating the cost of a tangible asset over its useful life.

Cumulative Weighted Average Expenditure

A method to calculate the total sum of expenses over a period, where each expenditure is weighted based on its timing or relevance.

Construction Loan

A short-term loan used to finance the building of a real estate project, typically with the property itself serving as collateral.