Given an upward-sloping aggregate supply curve, which of the following is most likely to occur if the Fed pursues restrictive monetary policy, ceteris paribus?
A. The equilibrium price level and output will both decrease.
B. The equilibrium price level and output will both increase.
C. The equilibrium price level will decrease but output will stay the same.
D. The equilibrium output will decrease but the price level will stay the same.
D. The equilibrium output will decrease but the price level will stay the same.
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Two variables are unrelated if their graph is i. a vertical line. ii. a 45 degree line. iii. a horizontal line
A) i only B) ii only C) iii only D) i and iii E) i, ii, and iii
The objects that we use as money today are
A) checks and credit cards. B) currency and checks. C) currency and deposits. D) deposits and checks. E) currency, deposits, and gold.
Someone notices that sunspot activity is high just prior to recessions and concludes that sunspots cause recessions. This person has:
a. confused association and causation. b. misunderstood the Ceteris paribus assumption. c. used normative economics to answer a positive question. d. built an untestable model.
Suppose the income tax rate is 0 percent on the first $10,000; 10 percent on the next $20,000; 20 percent on the next $20,000; 30 percent on the next $20,000; and 40 percent on all income above $70,000. Family X has income of $100,000 while Family Y has income of $40,000. The marginal tax rates faced by the two families are
A. 30 percent on X and 20 percent on Y. B. 40 percent on X and 10 percent on Y. C. 30 percent on X and 30 percent on Y. D. 40 percent on X and 20 percent on Y.