Taxes that create an excess burden are bad.
A. True
B. False
C. Uncertain
B. False
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The time it takes to overcome the practical and procedural hurdles before the Fed can begin to fix the economy is called the
A) recognition lag. B) implementation lag. C) impact lag. D) liquidity lag.
When the Federal Reserve ________
A) drains liquidity, the federal funds rate falls B) drains liquidity, real interest rates fall C) provides more liquidity, the federal funds rate falls D) all of the above E) none of the above
Which of the following is an advantage of earmarked taxes?
a. They are flexible. b. They never lead to overproduction. c. They make it more difficult for politicians to alter the expenditure mix away from their preferences. d. They make it easier for politicians to alter the expenditure mix to achieve economic efficiency.
Price elasticity is unit elastic at the midpoint of a linear, downward-sloping demand curve
a. True b. False