pumaabdulr pumaabdulr
  • 06-05-2020
  • Mathematics
contestada

If a tax cut of $12 billion causes real GDP to increase by $36 billion, then the tax multiplier is

Respuesta :

junwillcaburnay
junwillcaburnay junwillcaburnay
  • 06-05-2020

Answer:

3?

Step-by-step explanation:

Answer Link
abiolataiwo2015
abiolataiwo2015 abiolataiwo2015
  • 10-12-2021

Based on the information given the tax multiplier is 3.

Using this formula

Tax multiplier=Increase in GDP/Tax reduction

Where:

Increase in GDP=$36 billion

Tax reduction=$12 billion

Let plug in the formula

Tax multiplier=$36 billion/$12 billion

Tax multiplier=3

Inconclusion the tax multiplier is 3.

Learn more about tax multiplier here:https://brainly.com/question/7656808

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