Refer to Figure 12-9. At price P1, the firm would produce
A) Q1 units B) Q3 units. C) Q5 units. D) zero units.
D
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The ________ the marginal propensity to import, the ________ the multiplier
A) larger; more negative B) larger; smaller C) smaller; smaller D) larger; larger E) None of the above is correct, because the expenditure multiplier is not related to the marginal propensity to import.
If a budget deficit is the result of expenditures for programs such as farm subsidies and Social Security, the burden on future generations is slight
a. True b. False Indicate whether the statement is true or false
Which of the following examples illustrates a proportional income tax?
a. I earn $5,000 and pay $500 in taxes; you earn $10,000 and pay $1,000 in taxes. b. I earn $5,000 and pay $500 in taxes; you earn $10,000 and pay $500 in taxes. c. I earn $5,000 and pay $500 in taxes; you earn $10,000 and pay $800 in taxes. d. I earn $5,000 and pay $500 in taxes; you earn $10,000 and pay $1,200 in taxes.
In the short run, in equilibrium, firms that operate in a monopolistically competitive market face a down sloping demand curve and will charge a price where _____ and ______.
a. quantity produced is maximized; costs are minimized b. sales revenue is maximized; costs are falling c. MR = MC; P > average cost d. average costs are rising; sales are rising