The absolute value of the price elasticity of demand at the midpoint of a linear demand curve is always
a. greater than one
b. less than one
c. one
d. zero
e. infinity
C
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If you discovered that a country had an income tax system whereby the marginal and average tax rates were the same for all income levels what might you conclude is true about the structure of this income tax system
How is it possible in other words for the marginal and average tax rate to be the same?
The endowment effect is used to describe the mistake a consumer makes when he accounts for the monetary costs of his decisions but ignores the nonmonetary opportunity costs.
a. true b. false
If the MPC is 0.8, then the multiplier is 0.2.
Answer the following statement true (T) or false (F)
Which of the following is considered an advantage of monetary policy compared to fiscal policy?
A. It is blunter and more politically obvious than fiscal policy B. It does not have any of the time lags of fiscal policy C. Its relative isolation from political pressure D. Its cyclical asymmetry