Why Did the Tax Rebate of $78 Billion in 2008

question 242

Multiple Choice

Why did the tax rebate of $78 billion in 2008 have few net stimulus benefits?

• A) Consumers overspent the rebate and fell into debt.
• B) Consumers used much of the rebate to pay off existing debt.
• C) Consumers spent the money on frivolous items that did not have a multiplier effect.
• D) Consumers decided to save all of their rebate money.

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Definitions:

Group Members

Individuals who belong to a social or organizational group, share common goals, and are interconnected through roles, norms, and relationships within the group context.

Overwhelm

A state of being overpowered by emotions, tasks, or information to the extent that it is difficult to cope or respond effectively.

Tit For Tat

A strategy in conflict situations where an individual responds to an action with a similar or equivalent action; often described in the context of reciprocal actions.

Reciprocates

To respond to an action or gesture with a similar one, often in the context of social interactions and relationships, illustrating mutual exchange.