If Tax Rates Increased, Giving People a Decreased Incentive to Work

question 91

Multiple Choice

If tax rates increased, giving people a decreased incentive to work and businesses a decreased incentive to invest

• A) aggregate supply will decrease, aggregate output will decrease, and the price level will decrease.
• B) aggregate supply will decrease, aggregate output will decrease, and the price level will increase.
• C) both aggregate supply and demand will decrease, aggregate output will decrease, and the price level will decrease.
• D) aggregate supply will decrease, aggregate demand will increase, aggregate output will decrease, and the price level will increase.

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