Net taxes are ?
Correct answer: B. Taxes paid firms and households to the government minus the transfer payments made to firms and household
- A. taxes paid by firms and households to the government minus the cost of collecting the taxes
- B. Taxes paid firms and households to the government minus the transfer payments made to firms and household
- C. Taxes paid by firms and households to the government plus transfer payments made to firm and households
- D. government expenditures minus government revenues
Explanation
Net taxes equal taxes collected from households and firms minus transfer payments made to them. Transfers are subtracted because they return purchasing power to the private sector.
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About Macroeconomics
The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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