In the short term, a decrease in taxes will have what effect on GDP and unemployment?
A. It will reduce unemployment and reduce GDP.
B. It will raise unemployment and reduce GDP.
C. It will reduce unemployment and raise GDP.
D. It will raise unemployment and raise GDP.
Answer: C
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As one moves down a straight-line demand curve, the elasticity increases.
Answer the following statement true (T) or false (F)
The person who assumes the risks and uncertainties of business is
a. a manager of the business b. an owner of the business c. an excellent example of human capital d. an entrepreneur e. key to production, but not a factor of production
Kelly earns $72,000 per year from her fashion boutique. If the government increases the rate of tax from 12 percent to 15 percent, then her annual disposable income would: a. increase by $2,160
b. decrease by $2,160. c. increase by $10,800. d. decrease by $10,800.
If purchasing power parity holds and a basket of goods costs $300 in the U.S. and the same basket costs 450 manats in Azerbiajan, then what is the nominal exchange rate?
a. about .67 manats per dollar b. 1 manat per dollar c. 1.5 manats per dollar d. about 1.67 manats per dollar