The federal budget deficit acts as an automatic stabilizer because
A) Medicaid payments increase during expansionary periods.
B) unemployment insurance payments decrease during a recession.
C) food stamp payments increase during expansionary periods.
D) government tax revenues decrease during a recession.
D
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Over a period of years, many European countries replaced their transaction taxes with a value added tax. Give two reasons why this was done
What will be an ideal response?
Assume a perfectly competitive firm sells its output for $150 per unit. At its current 2,000 units of output, marginal cost is $180 and increasing, and average variable cost is $160 . Assuming it wants to maximize its profits, it should: a. increase output
b. decrease output, but not shut down. c. maintain its current output rate. d. shut down.
Private costs
A) are borne by producers of a good while social costs are borne by government. B) are borne by consumers of a good while social costs are borne by government. C) are borne by producers of a good while social costs are borne by society at large. D) are borne by producers of a good while social costs are borne by those who cannot afford to purchase the good.
If the absolute value of the price elasticity of demand for aspirin equals 0.8 then
A) aspirin is a normal good. B) the demand for aspirin is inelastic. C) aspirin has few substitutes. D) the demand for aspirin is elastic.