An increase in taxes will cause the consumption schedule to
a. shift upward.
b. shift downward.
c. remain fixed as the economy moves upward along the schedule.
d. remain fixed as the economy moves downward along the schedule.
b
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The federal funds rate is ________ of the Fed
A) a technique B) a monetary policy rule C) the monetary policy instrument D) an objective E) a goal
Which of the following statements differentiates between a shortage and a surplus?
A) A shortage occurs when price is held at the equilibrium price, but a surplus occurs when price is held above the equilibrium price. B) A shortage occurs when price is held below the equilibrium price, but a surplus occurs when price is held at the equilibrium price. C) A shortage occurs when quantity supplied exceeds quantity demanded, whereas a surplus occurs when quantity demanded exceeds quantity supplied. D) A shortage occurs when quantity demanded exceeds quantity supplied, whereas a surplus occurs when quantity supplied exceeds quantity demanded.
When the price of a resource goes up and firms seek other suitable resources, this is called the
a. substitution in production effect. b. substitution in demand effect. c. elasticity effect. d. inelasticity effect.
The marginal tax rate is
A) the sum of all individual tax rates. B) the total taxes paid as a percentage of total income. C) the average tax rate paid by both individuals and corporations. D) the increase in taxes as a percentage of the increase in income.