A cut in income tax rate to encourage the household consumption is an example of :
This is an expansionary demand side policy. A cut in income tax increases disposable income and encourages household consumption, thereby raising aggregate demand.
Choose your answer
A cut in income tax rate to encourage the household consumption is an example of :
Answer and explanation
Correct answer A
This is an expansionary demand side policy. A cut in income tax increases disposable income and encourages household consumption, thereby raising aggregate demand.
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Maharashtra and Goa SET (MH SET)