Which of the following is an argument for tax cuts rather than government spending as a way to promote recovery from a recession?
a. Tax cuts are better suited to direct resources into projects that consumers value more highly than the resources required for their production.
b. 100 percent of a tax cut will stimulate aggregate demand, but this will not be the case for an increase in government expenditures.
c. Tax cuts will encourage rent seeking; increases in government spending will not.
d. Tax cuts will change the structure of aggregate demand more than increases in government spending.
A
You might also like to view...
What variable has been shown to be highly correlated with nutrition, disease, and income, and is increasingly being used by economists to measure the well being of people?
a. Height. b. Weight. c. IQ. d. Gender.
If the simultaneous game is instead changed into a sequential game where the shoplifter can see whether the security guard is vigilant or not before deciding to steal. What is the Nash equilibrium of the game?
a. Steal, Vigilant b. Steal, Not vigilant c. Not steal, Vigilant d. Not steal, Not vigilant