Question

If the government uses tax money to pay for long term investments, what happens to the economy

Answer 1

Answer:

The correct answer would be, Investments Increases.

Explanation:

Government collects taxes from the people of the country and use it to serve the people from their own money by investing that money in the country's infrastructure. Government uses the tax payer's money to build the Roads, Dams, Recreational areas, Parks, railways, hospitals, schools, etc. These are the long term investments from the Government. When such type of work is done by the government, people's confidence build up on government and they invest more with the government. So in this way the Investments increases.