Answer to Question #67091 in Macroeconomics for Grace Tsai

Question #67091
18. If an economy is at full employment, an income tax cut will result in: A. a higher price level and more output in the short run, but only higher output in the long run. B. a higher price level and more output in the short run, but only a higher price level in the long run. C. an increase in LRAS and economic growth. D. a decrease in AD and an increase in capacity. E. an increase in AD and increased output in the long run.
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Expert's answer
2017-04-03T11:32:07-0400
Answer: b

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