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FromTheMoon [43]
4 years ago
12

If the government uses tax money to pay for long-term investments such as roads or other infrastructure, what happens to the eco

nomy?
A investment decreases
B taxes increase
C investment increases
D taxes decrease
Business
2 answers:
Leona [35]4 years ago
8 0
It definitely increases, the more that they invest the higher it becomes so I would go with C. Investment increases
coldgirl [10]4 years ago
4 0

Is this a theory type of question?

If it is and if it took place under president Calvin Coolidge then taxes likely would have gone up.

If you are talking about now, then investment might go up but in order to pay for it, the government will just print more money, so that taxes shouldn't go up.

I'd pick C.

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In this case, we will discount the cashflow for each year at 12% per annum.  The discount factor can be obtained by using the formula (1 + r)-n. Then, we will multiply the cashflows by the discount factors in order to obtain the present values. All the present values will be added up.

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