Chapter24: Fiscal Policy
Section: Chapter Questions
Problem 1P
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Question
An increase in the tax rates as a result of a new tax law passed by Congress is an example of ________.
a. discretionary fiscal policy
b. increasing the government debt
c. increasing the government deficit
d. needs-tested taxing change.
Expert Solution
Step 1
In an economy, government imposes taxes on the citizens to make different types of economic activities and to use public services.
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