The difference between a fixed tax and a variable tax is that
a. fixed taxes can never be changed, but variable taxes can be changed.
b. a change in fixed taxes has no effect on aggregate demand, but a change in variable taxes has an impact.
c. a variable tax changes when GDP changes, but a fixed tax does not change with GDP.
d. a variable tax can be changed easily, whereas changing fixed taxes requires a constitutional amendment.
c
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Ceteris paribus, an increase in the current or actual rate of inflation will cause
A) the unemployment rate to decrease (a movement along the short-run Phillips curve). B) the long-run Phillips curve to shift leftward. C) expectations of future inflation rates to be revised downward. D) the short-run Phillips curve to shift upward.
Suppose you only consume food and clothing, and clothing is plotted on the vertical axis. Also, you purchase food at a fixed price (PF), but the price of clothing declines as you buy in larger quantities (i.e., quantity discounts)
What does the budget line look like in this case? A) The budget line is a straight line B) The budget line is now concave to (bows out from) the origin C) The budget line is now convex to (bows in toward) the origin D) The budget line will not be a straight line, but it may be concave or convex
In perfect competition, the individual firm's long-run supply curve is the segment of
a. ATC that lies above the demand curve b. MC that lies above the AVC curve c. TC that lies below the TR curve d. MC that lies above the ATC curve e. AVC that lies above the MC curve
Which of the following is true?
a. Investment in the stock market is a relatively foolproof method for an investor to earn a high rate of return during the next five years. b. Current stock prices already reflect information that is known with a high degree of certainty. c. Experts are able to predict changes in the direction of the broad stock market indexes with a high degree of accuracy. d. While changes in the prices of specific stocks are difficult to predict, it is relatively easy to predict the future direction of the broad stock market. e. Both c and d are true.