When tax code changes increase saving incentives, the interest rate will _____ and investment will _____
Fill in the blank(s) with correct word
fall, increase
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The excess burden of an income tax is a function of the _____
a. average tax rate b. flat tax rate c. marginal tax rate d. Laffer curve
Which of the following is NOT correct?
A. ATC + AVC = AFC B. ATC = TC/Q C. AVC = TVC/Q D. MC = change in TC/change in Q
If the Federal Reserve eliminated all reserve requirements the most likely result would be
A) a large number of depository institution failures because they would not have enough liquidity. B) the Federal reserve would be unable to control the money supply. C) banks would no longer be able to clear checks at the Federal Reserve because there would be no required reserves. D) the size of the money multiplier might fluctuate considerably making the Federal Reserve's job of controlling the money supply more difficult.
The demand for money to cover unexpected expenditures and to meet emergencies is known as
A) the transactions demand for money. B) the precautionary demand for money. C) the asset demand for money. D) the terminal demand for money.