Economics · Macroeconomics
Which of the following statements are correct? (A) A proportional income tax is an automatic stabilizer. (B) An increase in autonomous spending raises the equilibrium level of income. (C) As the marginal propensity to consume gets larger, the lower the multiplier will be. (D) A reduction in transfer payments lowers the output. Choose the correct answer from the options given below:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1(A), (B), (C) and (D)
- 2(B), (C) and (D) only
- 3(A), (B) and (C) only
- 4(A), (B) and (D) only✓
Correct answer
(A), (B) and (D) only
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