An income tax ________ potential GDP by shifting the ________ curve ________.
A. increases; labor demand; rightward
B. decreases; labor demand; leftward
C. increases; labor supply; rightward
D. decreases; labor supply; leftward
Answer:D
An income tax ________ potential GDP by shifting the ________ curve ________.
A. increases; labor demand; rightward B. decreases; labor demand; leftward C. increases; labor supply; rightward D. decreases; labor supply; leftward