Suppose a country is in the midst of an economic boom and is running large budget surpluses. The president suggests that due to the good economic conditions, the time is ripe for a large tax cut. In this case, a tax cut will: Instructions: You may select more than one answer. Click the box with a check mark for correct answers and click to empty the box for the wrong answers. push AD to the right and increase output. unanswered increase the price level and costs. unanswered eventually cause a leftward shift of SRAS. unanswered push AD to the left and decrease output. unanswered decrease the price level and costs. unanswered eventually cause a rightward shift of SRAS. unanswered eventually cause a rightward shift of LRAS.

9. tax types: taxes are classified based on whether they are applied directly to income, called direct taxes, or to some other measurable performance characteristic of the firm, called indirect taxes. identify each of the following as a “direct tax,” an “indirect tax,” or something else: a. corporate income tax paid by a japanese subsidiary on its operating income b. royalties paid to saudi arabia for oil extracted and shipped to world markets c. interest received by a u. s. parent on bank deposits held in london d. interest received by a u. s. parent on a loan to a subsidiary in mexico e. principal repayment received by u. s. parent from belgium on a loan to a wholly owned subsidiary in belgium f. excise tax paid on cigarettes manufactured and sold within the united states g. property taxes paid on the corporate headquarters building in seattle h. a direct contribution to the international committee of the red cross for refugee relief i. deferred income tax, shown as a deduction on the u. s. parent’s consolidated income tax j. withholding taxes withheld by germany on dividends paid to a united kingdom parent corporation