A Tax Rebate,which Is Expected to Be Offered in This

question 61

Multiple Choice

A tax rebate,which is expected to be offered in this and all future years,will

• A)have a small positive effect on consumption and aggregate demand.
• B)have no effect on consumption and aggregate demand.
• C)have a significant positive effect on consumption and aggregate demand,with aggregate demand growing by a multiple of the tax rebate.
• D)increase aggregate supply and aggregate demand.

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Definitions:

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrium price.

Supply and Demand

Fundamental economic concepts where supply represents how much the market can offer, and demand represents how much of a product or service is desired by buyers.

Supply and Demand

Economic principles stating that the price of a good is determined by its availability (supply) and consumers' desire to purchase it (demand).

Price of the Good

The amount of money required to purchase a specific product or service in the market.