In reaction to the recession of 2001, a tax cut was passed in which tax rebate checks were sent to millions of American families. This was intended to
A)increase aggregate demand.
B)increase aggregate supply.
C)decrease aggregate demand.
D)decrease aggregate supply.

Question

Quizplus · Accepted Answer

The tax cut and rebate checks were intended to increase the disposable income of American families, which would then increase their consumption spending. This would lead to an increase in aggregate demand, which would help stimulate economic growth and recovery from the recession.

In Reaction to the Recession of 2001, a Tax Cut