BrainlyBoi
03.12.2020 •
Business
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Ответ:
D. decreases by less than $100 billion because the tax multiplier is negative
Explanation:
If the Government were to increase taxes then it would reduce the amount of money for spending (disposable income) that people have to be able to buy goods and services.
As a result they will buy less goods and services but this would be less than the $100 billion tax imposed on them because the effect of the tax multiplier is negative.
Tax Multiplier = -Marginal Propensity to Consume / (1 - MPC)