The government imposes a tax on imported wine. As a result, fewer individuals purchase imported wine. This is an example of tax
A. evasion.
B. equity.
C. shifting.
D. incidence.
Answer: C
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Based on the figure below. Starting from long-run equilibrium at point C, a decrease in government spending that decreases aggregate demand from AD1 to AD will lead to a short-run equilibrium at__ creating _____gap.
A. B; no output B. D; an expansionary C. B; recessionary D. D; a recessionary
In the figure above, D0 is the demand for labor curve. Imposing a minimum wage of $6 per hour will initially
A) increase employment from 20 to 40 million hours per year. B) increase employment from 30 to 40 million hours per year. C) decrease employment from 40 to 20 million hours per year. D) decrease employment from 30 to 20 million hours per year.
In the above figure, to achieve the efficient amount of paper production, the government could impose a tax of
A) $2 per ton. B) $8 per ton. C) $26 per ton. D) zero, because the efficient amount is produced with no government intervention.
Outsourcing of services to foreign countries:
a. Cost the U.S. economy an estimated 5 million jobs by 2005. b. Mainly impacts workers in business services such as data entry and software development. c. Is a serious concern for workers in high-wage manufacturing industries. d. Will have a serious negative impact on all service sector jobs in the United States