Starting from long-run equilibrium, a large tax cut will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. expansionary; higher; higher
B. expansionary; higher; potential
C. recessionary; higher; potential
D. recessionary; lower; lower
Answer: B
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Goods differ on the basis of whether their consumption is rival and excludable. Explain the terms "rivalry" and "excludability" as they are used to define goods
List the four categories of goods, and define these categories in terms of rivalry and excludability.
If net taxes decrease, which of the following would occur?
a. Disposable income decreases, consumption at any income level increases, and the consumption-income line shifts upward. b. Disposable income increases, consumption at any income level increases, and the consumption-income line shifts downward. c. Disposable income increases, consumption at any income level increases, and the consumption-income line shifts upward. d. Disposable income decreases, consumption at any income level decreases, and the consumption-income line shifts downward. e. Disposable income increases, consumption at any income level decreases, and the consumption-income line shifts downward.
What good or service creates positive externalities?
a. Vaccination against measles b. Vegan cookies c. Organic sweaters d. Eyesight correction surgery
Which of the following statements regarding the Lorenz curve is FALSE?
A. The less bowed is a Lorenz curve, the less equally income is distributed. B. A Lorenz curve that is perfectly straight represents complete income equality. C. The more bowed is a Lorenz curve, the more unequally income is distributed. D. A Lorenz curve is a geometric representation of the distribution of income.