Re: Macro question

Posted by viradgupta on
URL: http://discussion-forum.276.s1.nabble.com/Macro-question-tp7615564p7615565.html

one more ques plz:

Suppose there is a tax increase. Because during the economy's reaction to this the interest rate becomes

a) higher, the decrease in GDP is larger than if the interest rate had not changed

b) higher, the decrease in GDP is smaller than if the interest rate had not changed

c) lower, the decrease in GDP is larger than if the interest rate had not changed

d) lower, the decrease in GDP is smaller than if the interest rate had not changed