If our economy slumped into a recession, which of the following would help move

Question

If our economy slumped into a recession, which of the following would help move us back toward macro equilibrium?:
a. Reduce Taxes
b. Reduce Investment
c. Reduce Net Exports
d. Reduce Government Purchases

43. If our economy was experiencing inflation, which of the following would move us
back toward macro equilibrium?
a. Lower Taxes
b. Increase Investment
c. Reduce Net Exports
d. Increase Consumer Spending



Which of the following best describes a progressive tax
a. An 8% sales tax is progressive since people with more incomes spend more on consumer goods and hence pay more sales tax
b. Social security taxes since they are paid only on the first set portion of a person

Explanation / Answer

a) Increase disposable income and consumption, increasing GDP. c) Reducing exports reduces economic activity and puts less pressure on prices. c) a progressive tax means as people get more income they have higher tax rates.

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