Higher corporate taxes, higher capital gains taxes, and higher marginal tax rates shift aggregate supply left, causing price level to rise while reducing real GDP output. shift aggregate demand left, causing price level to rise while increasing real GDP output. shift aggregate supply left, causing price level to rise while increasing real GDP output. creates entrepreneurial incentives to innovate, and provides more government revenue which allows more government spending to increase fairness.

Higher corporate taxes, higher capital gains taxes, and higher marginal tax rates shift aggregate supply left, causing price level to rise while reducing real GDP output. shift aggregate demand left, causing price level to rise while increasing real GDP output. shift aggregate supply left, causing price level to rise while increasing real GDP output. creates entrepreneurial incentives to innovate, and provides more government revenue which allows more government spending to increase fairness.

MACROECONOMICS FOR TODAY

10th Edition

ISBN:9781337613057

Author:Tucker

Publisher:Tucker

Chapter11: Fiscal Policy

Section: Chapter Questions

Problem 9SQ

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