Question

Assume a nation’s economy is operating above full employment. if business taxes increase, how will output, employment, and price level likely change? output / employment / price level

Answer 1

Output / Employment / Price Level

Decrease Decrease Increase

Step-by-step explanation:

Answer 2

In a circumstance where the economy is operating in full employment, an increase in business taxes is likely to decrease the output, as a result of consequential unemployment that results from inability to pay workers, leading to the economy not functioning at full employment.