Answer to Question #110349 in Macroeconomics for zukile gantsho

Question

Which of the following statement is correct about the introduction of taxation in the Keynesian model?
1. It increases the value of the multiplier
2. It shifts the aggregate expenditure curve upwards
3. It increases net exprts
4. It swivels the aggregate expenditure curve downwards

Answer 1

4. It swivels the aggregate expenditure curve downwards