Consider the following three items of spending by the government: (i) the federal government pays a $500 unemployment benefit to an unemployed person; (ii) the federal government makes a $2,000 salary payment to a Navy lieutenant; (iii) the city of Bozeman, Montana makes a $10,000 payment to ABC Lighting Company for street lights in Bozeman. Which of these payments contributes directly to
government purchases in the national income accounts?
a. only item (i)
b. only item (ii)
c. only items (i) and (ii)
d. only items (ii) and (iii)
d
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The effect of a drop in business confidence on the evaluation of MPK shifts the IS curve to the ________. Suppose the LM curve is fixed
The resulting ________ in the interest rate works through the accelerator model to ________ the fall in equilibrium output. A) left, rise, increase B) left, rise, more than offset C) left, fall, offset part of D) right, rise, offset part of E) right, fall, more than offset
The practice of selling a product to different customers at different prices when marginal cost is the same is known as: a. price discrimination. b. monopoly pricing
c. arbitrage. d. price segregation.
The labor supply curve
a. slopes upward to illustrate that more people will want to work as the real wage increases b. slopes upward to illustrate that changes in the real wage are directly proportional to changes in the nominal wage c. may slope either upward or downward, depending upon the real wage d. slopes downward to illustrate that a decrease in the real wage decreases the number of individuals willing to work e. slopes downward to illustrate that the availability of workers is directly proportional to the real wage
In practice, taxes on emissions of pollutants have been found to
A. be ineffective in encouraging firms to pollute less. B. significantly reduce pollution by taxed firms. C. be less reliable in reducing pollution than direct controls on pollution. D. cause failures of the pricing system.