An Increase in the Effective Tax Rate on Capital Would

question 31

Multiple Choice

An increase in the effective tax rate on capital would cause the IS curve to ________ and the LM curve to ________.

• A)shift down and to the left; be unchanged
• B)shift down and to the left; shift up and to the left
• C)shift up and to the right; be unchanged
• D)shift up and to the right; shift up and to the left