Multiple Choice
A progressive income tax system is particularly effective as an automatic stabilizer because
A) It reduces demand when income falls.
B) In a booming economy,taxpayers move into higher tax brackets,which restrains their spending.
C) During a recession,it causes the budget deficit to fall.
D) It falls more heavily on taxpayers with high MPCs,which stimulates aggregate demand.
Correct Answer:
Verified
Correct Answer:
Verified
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