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3 years ago

A decrease in individual income taxes disposable income, which consumption spending.

Business

1 answer:

Marta_Voda [28]3 years ago

7 0

Answer:

A decrease in individual income taxes increase disposable income, which increases comsumption spending

Explanation:

In a classic economic model, people want to consume all of their income, but if consumers have other obligations (such as taxes), they paid them (obligations) first and the remain income is called disposable income. If these obligations decrease then the remaining income will increase (disposable income increases) and because people always want to consume, this increase in disposable income will traduce in an increase in consumption.

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Answer:

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A decrease in individual income taxes disposable income, which consumption spending.