The initial impact of an increase in an investment tax credit is to shift aggregate Demand right.
<h3>What is meant by investment tax?</h3>
Investment income is primarily subject to two types of taxes: Any interest from savings accounts or money from dividends from shares is subject to income tax. Taxes that are due on profits made from the sale of an investment asset are referred to as capital gain tax (CGT).
Your ordinary income and short-term capital gains are taxed at the same rate. Taxable income: Depending on your taxable income, long-term capital gains and qualifying dividends are typically taxed at special capital gains tax rates of 0%, 15%, and 20%.
Demand is the amount of a good that buyers are ready and willing to buy at different prices at a particular time. The demand curve is another name for the relationship between price and quantity demand. Demand is just a consumer's desire to buy products and services immediately and to pay the price associated with them. Demand can be defined as the quantity of things that consumers are prepared and willing to purchase at various prices within a specific time frame.
Hence, The initial impact of an increase in an investment tax credit is to shift aggregate Demand right.
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