If taxes go up and all else remains equal, then consumption should:
a. rise by more than the tax increase.
b. rise by the same amount as the tax increase.
c. rise by less than the tax increase.
d. fall.
Ans: d. fall.
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Capital is the
a. flow of new equipment that a firm acquires over the course of a year. b. amount of increase in a firm's equipment over a year. c. amount of money that a firm has on hand at a given time. d. stock of plant, equipment, and other productive resources held by a firm.
Which of the following would not cause market demand for a normal good to decline?
a. An increase in the price of a complement. b. An increase in the price of a substitute. c. An announcement by the Surgeon General that the product contributes to premature death. d. Consumer expectations that the good will go on sale in the near future. e. A decline in consumer income.
The impact of an increase in oil prices stemming from the growth of demand is probably going to ____ the wages of petroleum engineers.
A. decrease B. increase C. leave unaffected D. be impossible to predict
If Congress and the president pursue an expansionary fiscal policy at the same time as the Federal Reserve pursues an expansionary monetary policy, how might the expansionary monetary policy affect the extent of crowding out in the short run?
What will be an ideal response?