If a tax increase of $8 billion caused real GDP to decline by $32 billion, then the economy's MPC is
A. 0.5.
B. 0.9.
C. 0.6.
D. 0.8.
Answer: D
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An example of a transfer payment is
A) a welfare payment. B) a paycheck for a member of the National Guard. C) a purchase of a new bridge in Alaska. D) a teacher's paycheck.
The idea of two individuals being equally well off in the absence and existence of taxation is
A. time consistency of optimal taxation. B. flat tax income schedule. C. benefits received principle. D. utility definition of horizontal equity.
Which of the following groups was Jefferson most trying to help in setting up the Land Ordinances?
(a) His friends, the land speculators (b) The urban proletariat (c) The small farmers (d) Fellow slave owners
Is there a first-mover advantage in the Bertrand duopoly model with homogenous products?
A) Yes, first-movers always hold the advantage over other firms. B) Yes, first-movers may have an advantage, but it depends on the model assumptions. C) No, first-movers cannot choose a profit maximizing quantity because the second-mover can always produce a bit less and earn higher profits. D) No, the second-mover would be able to set a slightly lower price and capture the full market share.