Answered: If consumers spend of a change in their…

If consumers spend of a change in their disposable income, then a tax increase of $100 would lower saving by $40. O 20 percent 40 percent O 60 percent O 80 percent O 70 percent

Principles of Macroeconomics (MindTap Course List)

7th Edition

ISBN:9781285165912

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter13: Savings,Investment And The Financial System

Section: Chapter Questions

Problem 2QCMC

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Concept explainers

Public Saving

Public saving deals with the amount which has been in excess after meeting all the obligatory expenses and investment of the government. Taxes are collected by the government to meet its day-to-day expenditures. The obligatory expenses include all those expenses which are mandatory for the government. It cannot be avoided as it is inevitable.

Question

If consumers spend
of a change in their disposable income, then a tax increase of $100 would
lower saving by $40.
O 20 percent
40 percent
O 60 percent
O 80 percent
70 percent

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