chapter 16 (homework) - 1 A cut in the income tax rate the...

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1-A cut in the income tax rate________the tax wedge and________employment,saving,and investment.Decreases;increases. 2-If we compare the United States toFrance,the U.S. tax wedge is________the French tax wedge.Smaller than.3-The crowding out effect refers to the________from________in thegovernment'sbudget deficitdecrease ininvestment;an increase.4-The standard view in economics is that tax cuts without________will________the budget deficitresulting in________.spendingcuts;increase; crowding out investment5-If a tax cut increases aggregate demand more than aggregatesupply,real GDP________and the price level________.increases;rises6-How could an expansionary fiscal policy increase real GDP and lower the pricelevel?if aggregate supply increases more than aggregate demand increases7-The quantity of employment is determined in the________market and thatquantity,along with the________,determines potential GDPlabormarket;production function8-Increasing the income tax rate________the________.decreases;supply of labor9-If the income tax rate is 20 percent and the tax rate on consumption expenditure is 15

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