Suppose the economy has a high level of unemployment. This would imply
A) that the economy is operating on the SRAS curve and that government spending could be decreased to reduce unemployment.
B) that the government should engage in expansionary fiscal policy and increase the tax rate.
C) that fiscal policy has been ineffective and should be abandoned.
D) that the economy is operating to the left of the LRAS curve and that government spending could be increased to reduce unemployment.
D
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Facing choices between beer and pizza, the number of pizzas a consumer would be willing to trade for just one beer is called
a. the marginal value of beer in terms of pizza. b. the marginal value of pizza in terms of beer. c. the demand for beer. d. an undesirable trade.
Refer to Figure 8.2. Holding other variables constant, an increase in the real wage will result in a
A) movement from point A to point B. B) movement from point B to point A. C) shift from curve S1 to curve S2. D) shift from curve S2 to curve S1.
Tax incidence is the portion of a tax paid by a buyer or a seller
a. True b. False Indicate whether the statement is true or false
Which of the following elements are commonly emphasized by people who criticize advertisements?
a. increases elasticity; harms competition; manipulates consumer tastes b. increases elasticity; provides service information; causes demonstration effect c. provides service information; causes demonstration effect; manipulates consumer tastes d. harms competition; causes demonstration effect; manipulates consumer tastes