Economists who believe that real GDP may grow slowly because of insufficient demand for investment spending cite three main reasons for the low demand for loanable funds. Which of the following is not one of those reasons?
A) a reduced demand for housing due to slowing population growth
B) the continued decrease in the value of the dollar relative to the currencies of major U.S. trading partners
C) a smaller capital requirement for modern information technology firms
D) the falling price of capital relative to other goods
B
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Suppose that the U.S. undertakes a policy to increase its saving rate. This policy will likely
a. have no impact on the growth rate of real GDP per person. b. decrease the growth of real GDP per person for a few years. c. increase the growth of real GDP per person for several decades. d. permanently increase the growth rate of real GDP per person.
An increase in income in other countries, other things equal, would cause U.S. _____
Fill in the blank(s) with the appropriate word(s).
Suppose the government taxes 30 percent of the first $70,000 and 50 percent of all income above $70,000 . For a person earning $200,000 . the marginal tax rate is
a. 30 percent, and the average tax rate is 50 percent. b. 30 percent, and the average tax rate is 43 percent. c. 50 percent, and the average tax rate is 40 percent. d. 50 percent, and the average tax rate is 43 percent.
Transfer payments are excluded from government purchases in GDP accounting because
A) they are a reward to individuals who have been productive their entire lives. B) they are difficult to measure. C) nothing is being produced in return for the payment. D) they are already included as part of investment.