According to the Keynesian Approach, a Decrease in Taxes

question 167

Multiple Choice

According to the Keynesian approach, a decrease in taxes

• A) will increase consumption exactly by the amount of the taxes.
• B) will increase consumption by an amount of less than the change in taxes.
• C) will not impact consumption, as most consumption is autonomous.
• D) will decrease consumption, as the government will have to spend less.

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Definitions:

Dependent Variable

In an experimental setup, the variable being tested and measured, expected to change as a result of manipulations to the independent variable.

Variability

The degree of spread or dispersion within a set of data points or values, reflecting how much the data points differ from each other.

Mode

The value that appears most frequently in a data set, representing the most common outcome or observation.

Correlated

When two or more variables are related in some way, showing a tendency to vary together, implying a relationship or association between them.