A Change in Taxes or a Change in Government Transfers

question 101

Multiple Choice

A change in taxes or a change in government transfers affects consumption through its effect on:

• A) autonomous consumption.
• B) the marginal propensity to save.
• C) disposable income.
• D) government spending.

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Definitions:

Mutual Agency

A principle in partnership businesses where each partner has the power to bind the partnership in agreements with third parties.