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Question 12 1 pts The fraction, or percentage, of total income that is consumed is called the break-even income. consumption
Question 14 1 pts The effect of a decline in taxes on the level of income will differ somewhat from an increase in government
1 pts Question 15 Assume there are no investment projects that will produce an expected rate of return of 8% or more. There a
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Answer #1

Due to presence of HOMEWORKLIB POLICY, I am answering 2 questions.

Question 12.

Ans: average propensity to consume.

Explanation: APC = C / Y

where,

C = Consumption

Y = Income

Question 14.

Ans: households may not spend all of an increase in disposable income.

Explanation: With rise in disposable income after tax cut only MPC is spent but in case of government spending all of it is spent. Hence, tax cut has less impact on output than rise in government spending.

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