An economy with an expansionary gap will, in the absence of stabilization policy, eventually experience a(n) ________ in the inflation rate, leading to a(n) ________ in output.
A. decrease; increase
B. increase; increase
C. decrease; decrease
D. increase; decrease
Answer: D
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Vertical equity is not consistent with a regressive tax structure
a. True b. False Indicate whether the statement is true or false
Management's power in collective bargaining sessions rests on
A. The firm's market power in pricing its product. B. The ability to lock out workers by closing stores or factories. C. The ability to fire nonunionized workers. D. The company's stock valuation.
The total cost of producing one unit is $50. The total cost of producing two units is $75. At a production level of two units, the cost function exhibits
A) economies of scale. B) rising average costs. C) increasing marginal costs. D) constant returns to scale.
The progressive income tax is a money transfer system—from the taxpayer to government—and it is in the nature of this system that during recessions, less is taken from people than is taken in periods of prosperity. It is in this sense that the progressive income tax system is regarded by economists as
a. an unfair intervention in people's lives b. a countercyclical discretionary force c. a system that is unrelated to government spending d. an automatic stabilizer e. volatile and capricious