A Significant Example of a Temporary Tax Cut Was the One

question 31

Multiple Choice

A significant example of a temporary tax cut was the one announced in 1992 by President George H. W. Bush. The effect of that tax cut on consumer spending and aggregate demand was

• A)zero.
• B)likely smaller than if the cut had been permanent.
• C)likely about the same as if the cut had been permanent.
• D)likely larger than if the cut had been permanent.

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Definitions:

Discount Period

The timeframe in which a buyer can pay less than the full invoice amount due to taking advantage of a sales discount offered by the seller for early payment.

Full Settlement

This term refers to the complete payment or resolution of an outstanding debt, account, or contractual obligation.

FOB Shipping Point

A term used in shipping contracts to indicate that the seller is responsible for delivering goods to a shipping point, and the buyer is responsible for all costs and risks of loss or damage to goods from that point forward.

Credit Memo

A document issued by a seller that reduces the amount owed by a buyer, typically due to a return or refund.