The fiscal stimulus associated with a tax cut is:
A. The same as the stimulus associated with an increase in transfer payments.
B. The same as the stimulus associated with a decrease in transfer payments.
C. Less than the stimulus associated with an increase in transfer payments.
D. Greater than the stimulus associated with an increase in government spending.
Answer:A
The fiscal stimulus associated with a tax cut is:
A. The same as the stimulus associated with an increase in transfer payments. B. The same as the stimulus associated with a decrease in transfer payments. C. Less than the stimulus associated with an increase in transfer payments. D. Greater than the stimulus associated with an increase in government spending.