Subject - Economics:

Macroeconomics

MCQ - 32-4042

Question:

The government has just lowered personal income taxes. Which of the following best describes the effects that this policy has on the economy?

Higher disposable income, higher consumption, higher real GDP, lower unemployment
Higher disposable income, lower consumption, higher real GDP, lower unemployment
Lower disposable income, higher consumption, higher real GDP, lower unemployment
Higher disposable income, lower consumption, higher real GDP, lower unemployment
Higher disposable income, higher consumption, higher real GDP, higher unemployment

Correct Answer: A

Explanation:

Lower taxes increase disposable income. Consumers spend most of this disposable income, which increases real GDP and lowers the unemployment rate.

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269 MCQ for effective preparation of the test of Macroeconomics of Economics section.

Read the MCQ statement: The government has just lowered personal income taxes. Which of the following best describes the effects that this policy has on the economy? , keenly and apply the method you have learn through the video lessons for Macroeconomics to give the answer. Record your answer and check its correct answer and video explanation for MCQ No. 32-4042.

How to Answer

Solve the question for MCQ No. and decide which option (A through D/E) is the best choice to answer the MCQ, then click/tap the blue button to view the correct answer and it explanation.

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