Which of the following observations is true?
a. Tax changes have no impact on the consumption schedule.
b. Tax reduction shifts the consumption schedule upward.
c. Changes in taxes have a multiplier effect on equilibrium GDP on the supply side.
d. Tax increases increase equilibrium GDP.
b
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The above figure shows the market for labor. The employer is a monopsony. The firm will maximize its profit by hiring 400 hours of labor because at that point
A) MCL > W. B) VMP > W. C) MCL > VMP. D) MCL = VMP.
Refer to Figure 7.1. At output level Q3
A) average fixed cost reaches its minimum. B) average total cost reaches its minimum. C) average variable cost reaches its minimum. D) marginal cost reaches its minimum. E) all of the above
An increase in the supply of loanable funds, other things constant, will increase the interest rate
a. True b. False Indicate whether the statement is true or false
Refer to the figure below. If the supply curve returns to its initial level of S a , the amount of consumer surplus will return to its original level.
A. True
B. False
C. Uncertain