Suppose a Country Has Only a Sales Tax

question 200

Multiple Choice

Suppose a country has only a sales tax. Now suppose it replaces the sales tax with an income tax that includes a tax on interest income. This would make equilibrium

• A)interest rates and the equilibrium quantity of loanable funds rise.
• B)interest rates rise and the equilibrium quantity of loanable funds fall.
• C)interest rates fall and the equilibrium quantity of loanable funds rise.
• D)interest rates and the equilibrium quantity of loanable funds fall.

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Definitions:

Manager sharing the problem

A leadership approach where managers involve their team in problem-solving processes to encourage ownership and diverse input.

Organizational Culture

is a system of shared beliefs, values, norms, and practices that influences how members of an organization interact with each other and with stakeholders outside the organization.

James Heskett

An academic known for his contributions to business management, particularly in the areas of organizational culture, service management, and customer satisfaction.

John Kotter

A professor of leadership at Harvard Business School best known for his work on change management and leadership.