what-are-the-implications-of-ignoring-taxes-in-the-calculation-of-the-multiplier

Question

What are the implications of ignoring taxes in the calculation of the multiplier effect?

Accepted Answer

Ignoring taxes can lead to overestimating the economic impact of investment spending.

Answer

Ignoring taxes leads to underestimating the economic impact of investment spending.

Answer

Ignoring taxes reverses the economic impact of investment spending.

Answer

Ignoring taxes has no implications for economic predictions.