If the income multiplier is equal to 5, then a $1 initial increase the country's exports will lead to a

a. 5 percent decrease in national income
b. 5 percent increase in national income
c. $5 decrease in national income
d. $5 increase in national income
e. 0.05 percent increase in national income


D

Economics

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Which of the following ideas is the most plausible?

a. Reducing a high tax rate is less likely to increase tax revenue than is reducing a low tax rate. b. Reducing a high tax rate is more likely to increase tax revenue than is reducing a low tax rate. c. Reducing a high tax rate will have the same effect on tax revenue as reducing a low tax rate. d. Reducing a tax rate can never increase tax revenue.

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If the economy is currently in a recessionary gap, the SRAS curve intersects the AD curve to the left of Natural Real GDP

Indicate whether the statement is true or false

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A state of rational ignorance

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Economics