(03.08 MC) What will be impact of an income tax increase on an economy's consumption spending, real output, and unemployment in the short run? O Consumption will decrease, real output will decrease, and unemployment will increase. O Consumption will increase, real output will increase, and unemployment will decrease. O Consumption will increase, real output will decrease, and unemployment will increase. Consumption will increase, real output will increase, and unemployment will decrease. O Consumption will decrease, real output will decrease, and unemployment will decrease.

(03.08 MC) What will be impact of an income tax increase on an economy's consumption spending, real output, and unemployment in the short run? O Consumption will decrease, real output will decrease, and unemployment will increase. O Consumption will increase, real output will increase, and unemployment will decrease. O Consumption will increase, real output will decrease, and unemployment will increase. Consumption will increase, real output will increase, and unemployment will decrease. O Consumption will decrease, real output will decrease, and unemployment will decrease.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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14. In 2020 consumption (Ci) for selected countries was as follows Jordan 2.5 billion $, USA 100 billion $, Canada 50 billion $, France 40 billion $ Qatar 10 billion $. and Russia 70 billion $. for the same year Income (Yi) was: Jordan 12 billion $, USA 900 billion $, Canada 700 billion $, France 500 billion $ Qatar 60 billion $. and Russia 100 billion $. This data is * Variable in time but change over countries O fixed in time and fixed in countries Fixed in time but change over countries Variable in time but fixed in countries none of the choices are true
Use the table below to answer the following question. Income (Dollars) 20,000 24,000 O 0.75 What is the marginal propensity to consume? O 0.875 O 0.90 Consumption (Dollars) O 1.33 18,000 21,500
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/se estion 5 Suppose you were looking at an economy where the consumption function is; C = 50 +0.75Y And you know that investors want to spend 500 at every level of income. In other words 1-500 a. What is the equilibrium level of income? b. If the full - employment level of income is 2000, is there a recessionary gap? If so, how large is the gap? c. What will happen to the equilibrium level of income if investors become pessimistic about the country's future and reduce their investment to 400? d. Is there an inflationary or recessionary gap now? How large? marks) Format Tools Table TV- BIU AV V T²v / pov
8 Aggregate planned expenditure. (trillions of 2009 dollars) a 7 15 14 15 16 17 18 O # 14 45° line less than $16 trillion. $16 trillion. more than $16 trillion. AE 19 In the above figure, equilibrium expenditure is some amount that cannot be determined without more information. Kk 4
Consumption expenditure (trillons of 2012 dollars) 25 45° line 20 15 Consumption funccion 10 E ua n e 10 15 20 Disporable income (crillions of 2012 dollars) 14
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