Planned Investment Must Equal Actual Investment for

question 259

Multiple Choice

Planned investment must equal actual investment for

• A) the MPC to equal the MPS.
• B) consumption to equal saving.
• C) saving to equal income.
• D) the economy to be in equilibrium.

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Definitions:

Proportional Tax

A tax system where the tax rate remains constant regardless of the amount subject to taxation, meaning that taxpayers pay the same percentage of their income in taxes regardless of how much they earn.

Regressive Tax

A tax that takes a larger percentage of income from low-income earners than from high-income earners, essentially burdening the poor more than the rich.

Proportional Tax

A proportional tax is a tax system where the tax rate remains constant regardless of the amount subject to taxation, meaning individuals pay the same percentage of their income regardless of income level.

Regressive Tax

A tax imposed in such a manner that the tax rate decreases as the amount subject to taxation increases, disproportionately affecting those with lower income.