Prolonged periods of monetary contraction, as was the case during the Great Depression, will likely result in
a. an increase in real output and employment.
b. an increase in loanable funds and upward pressure on the rate of inflation.
c. a decrease in output and downward pressure on prices.
d. a decrease in unemployment and upward pressure on prices.
C
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Why are lump-sum taxes regressive in nature?
What will be an ideal response?
In the bond market, the buyer is considered to be
A) the lender. B) the borrower. C) the lender or the borrower, depending upon the use to which the funds are put. D) the lender or the borrower, depending upon whether interest rates are rising or falling.
About 35,000 general aviation multiengine airplanes are licensed to operate in the United States. If an additional $1,000-per-year tax was levied on each plane to raise general revenue, economic thinking suggests the
a. annual revenue from this tax would be less than $35,000,000. b. annual revenue from this tax would be $35,000,000. c. annual revenue from this tax would be more than $35,000,000. d. number of airplanes would increase dramatically.
The key determinant of net capital outflow is the real interest rate
a. True b. False Indicate whether the statement is true or false