A tax is efficient if
A) it is based on profits earned and not on wages.
B) it imposes a small excess burden relative to the revenue it raises.
C) it encourages saving and investment.
D) individuals with the lowest incomes pay proportionately lower taxes than individuals with the highest incomes.
B
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Explain the general theory of the classical models comparing to Keynes theories
What would be an ideal response?
If the Federal Reserve accommodates an adverse supply shock,
a. inflation expectations may rise which shifts the short-run Phillips curve shifts right. b. inflation expectations may rise which shifts the short-run Phillips curve shifts left. c. inflation expectations may fall which shifts the short-run Phillips curve shifts right. d. inflation expectations may fall which shifts the short-run Phillips curve shifts left
To stimulate the economy, the government is likely to
A. increase spending. B. restrict trade. C. raise prices. D. decrease expenses
In a Cournot oligopoly, a decrease in a firm's marginal cost leads to:
A. reduced output and a lower price. B. higher output and a higher price. C. higher output and a lower price. D. reduced output and a higher price.