B Will become a larger part of the economy
With the decrease in the value-added tax on consumers, consumer spending is likely to increase, leading to a boost in economic activity. This increase in economic activity could result in the state's economy becoming a larger part of the overall economy.
A new administration reforms, a states tax code corporate tax was increased by 3% allowing the value added tax on consumer to be reduced by 5%. This had no effect on the state budget as the tax changes balanced each other out.
A likely effect of this change in tax policy
A High income people would choose to leave the state
B Will become a larger part of the economy
C Consumers in the state will choose to buy things
D Financial institutions will be less likely to invest in the states companies
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