Question

a decrease in the tax rates in an economy will cause a:

a. leftward shift of the aggregate demand curve if the crowding out effect is larger than the size of the tax multiplier.

b. rightward shift of the aggregate demand curve if the crowding out effect is larger than the size of the tax multiplier.

c. rightward shift of the aggregate demand curve if the crowding out effect is equal to the size of the tax multiplier.

do. leftward shift of the aggregate demand curve if the crowding out effect is smaller than the size of the tax multiplier.

please help!