The supply-side effects show that a tax cut on labor income ________ employment and ________ potential GDP
A) increases; increases
B) increases; does not change
C) increases; decreases
D) decreases; increases
E) decreases; decreases
A
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Market power refers to
A) the ability of a firm to sell at a lower price than rival sellers. B) the ability of a firm to advertise its product and succeed in selling more output. C) the ability of a firm to charge a price higher than the marginal cost of production. D) the ability of consumers to dictate what products should be produced.
Explain how an increase in the American demand for German goods leads to a change in the German Mark relative to the U.S. dollar
National income is the sum of
A. wages and profits. B. wages, interest, profits, and rent. C. interest and rent. D. wages, transfer payments, and tax revenues.
Figure 33-8
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In Figure 33-8, which of the following movements reflects the closing of a recessionary gap through the economy’s self-correcting mechanism?
A. A to B B. A to C C. C to E D. D to E