The use of a property tax to fund public schools is an example of _____
a. the benefit principle at work
b. the ability-to-pay principle at work
c. a compromise between the benefit and ability-to-pay principles
d. the Ramsey rule at work
c
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Which of the following transactions would count in GDP?
a. Kerry buys a new sweater to wear this winter. b. Patricia receives a Social Security check. c. Roberto gives his daughter $50 for her birthday. d. Latika sells $1,000 of Google stock. e. Karen buys a new car. f. Amy buys a used car.
Figure 6-9
In 1983, government price supports raised the price of sugar above its equilibrium value. Which graph in Figure 6-9 illustrates the impact of sugar price supports on the sugar substitute fructose?
A. 1 B. 2 C. 3 D. 4
Suppose the economy is initially operating at full employment. A fiscal policy action that results in an increase in the size of the budget deficit will cause which of the following in the long run?
A) an increase in real GDP. B) have no effect on both the level and composition of real GDP. C) a reduction in the price level. D) change the composition of real GDP.
When sketched as a function of disposable income, the investment demand curve is:
a. always horizontal. b. always vertical. c. upward sloping. d. parabolic.