Why would a higher tax rate lower the government purchases multiplier? What does the tax rate have to do with the government purchases multiplier?
What will be an ideal response?
The tax rate affects how much of the additional income that results from the initial increase in government purchases is available to be consumed. A higher tax rate decreases the amount of disposable income that can be consumed at each round of the multiplier process.
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Tris is shopping for pants and belts. He has a budget of $100. The price of a pair of pants is $20 and the price of a belt is $5. His marginal utility schedules are above. What combination of pants and belts does Tris buy? Explain your answer
What will be an ideal response?
Refer to Table 4-6. The table above lists the marginal cost of polo shirts by Marko's, a firm that specializes in producing men's clothing. If the market price of Marko's polo shirts is $13, Marko's will produce
A) 1 shirt. B) 2 shirts. C) 3 shirts. D) 4 shirts.
During the 1990s, Japan experienced periods of deflation and nominal interest rates that approached zero percent. Why would anyone lending money agree to a nominal interest rate of almost zero percent?
What will be an ideal response?
China's income inequality as measured by the Gini coefficient
a. has about doubled since MaoÕs time b. is greater than South Korea and Taiwan c. is low because China is a socialist country d. is less than that of Europe e. a and b are correct