Joe earns $10,000 in income and pays $1,000 in taxes while Jack earns $30,000 and pays $4,000 in taxes. The structure of this tax is:
A. regressive.
B. progressive.
C. a head tax.
D. proportional.
Answer: B
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Moving along the short-run aggregate supply curve, ________
A) the real wage rate is constant B) real GDP equals potential GDP C) the money wage rate, the prices of other resources, and potential GDP remain constant D) real GDP equals nominal GDP
The table shows the balance sheet for Ralph's Bank. If the desired reserve ratio is 15 percent, the maximum additional amount that Ralph's Bank can loan is equal to ________
A) $50 B) $500 C) $450 D) $2,500
The Keynesian-cross model implies that changes in aggregate supply cause fluctuations in real GDP
a. True b. False Indicate whether the statement is true or false
In the equation of exchange, if the velocity of money is constant, a 10 percent increase in the money supply must:
A. increase real GDP by 10 percent. B. result in a higher level of unemployment. C. increase nominal GDP by 10 percent. D. increase the price level by 10 percent.