1. Define the components of each variable in the NI (national income) equation (W, T, and S). Explain how each of these variables is estimated. Explain how governmental changes in the income tax rate influence the value of the other two variables. 
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3. What does an increase in wages with a resulting decrease in income taxes likely mean for Consumer Spending (C) and Business Investments?

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The national income equation NI is a macroeconomic identity that shows the relationship between the various components of national income in an econom... View the full answer