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A Change in Taxes Shifts the Aggregate Demand Curve by Less

question 145

True/False

A change in taxes shifts the aggregate demand curve by less than a change in government spending for goods and services and has a smaller effect on real GDP.


Definitions:

Takeover Bid

An offer made by an entity to acquire a controlling interest in another company.

Available-for-sale Securities

Financial assets not classified as held-to-maturity or trading securities, which can be sold in response to needs for liquidity or changes in interest rates, among other reasons.

Recorded

The act of documenting financial transactions in the accounting records.

Controlling Interest

Ownership of a sufficient portion of a company's stock to influence or control its activities and decisions.

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