While tax cuts may increase productivity, the government is forced to redistribute the tax burden or cut its own spending
a. True
b. False
A
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The "law of demand" in economic theory asserts that
a. demand generates a supply sufficient to satisfy the demand. b. nothing will be produced unless there is a demand for it. c. people will purchase less of a good when its price rises. d. wants are indefinitely expansible and can never be fully satisfied. e. whatever people want will eventually be supplied.
In a constant-cost industry, input prices remain constant as:
a. the supply of inputs fluctuates. b. firms encounter diseconomies of scale. c. workers become more experienced. d. firms enter and exit the industry.
Which of the following groups believes that unemployment is only a temporary condition that disappears when unemployed workers, competing for jobs, drive down wage rates?
a. classical school b. Keynesian school c. neo-Keynesian school d. rational expectations school e. supply-side school
Legislation that offers immediate and easily recognized benefits, at the expense of costs that are observable only in the distant future, is often enacted, even when economic inefficiency results. In economics this is referred to as the
a. long-term effect. b. political-fallacy effect. c. shortsightedness effect. d. inefficiency effect.