Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential
B. expansionary; lower; potential
C. expansionary; higher; potential
D. recessionary; lower; lower
Answer: A
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An example of a Pigovian tax would be a tax on:
A. cigarettes. B. alcohol. C. gasoline. D. All of these are examples.
Marginal cost is equal to
a. TC/Q. b. ?ATC/Q. c. ?TC/?Q. d. ?Q/?TC.
An individual's labor supply curve
A. Slopes downward initially, and then may bend upward. B. Always slopes downward. C. Slopes upward initially, and then may bend backward. D. Always slopes upward.
The larger the U.S. imposed per unit import tariff on a good imported and produced in the United States,
A) the smaller the U.S. consumer surplus. B) the larger the U.S. producer surplus. C) the larger the government revenue. D) All of the above.