What would be the effect of a reduction in the corporate profits tax?
a. Investment would decrease, the production function would shift downward, productivity would decrease, and so would output.
b. Investment would increase, the production function would shift upward, productivity would increase and output would decrease.
c. Investment would increase, the production function would shift upward, and both productivity and output would increase.
d. Investment would decrease, the production function would shift downward, and both productivity and output would increase.
e. Investment would increase, the production function would shift upward, productivity would decrease and output would increase.
C
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An increase in the demand for gasoline today caused by concerns that gasoline prices will be higher tomorrow is most likely attributable to which demand shifter?
A) income B) consumer expectations C) consumer preferences D) prices of other goods
When and under what circumstances is intervention in international trade justified on market correction grounds? What preconditions would have to be met from the government side for there to be a reasonable likelihood of success?
What will be an ideal response?