The more elastic the supply curve, the ____ will be the effect of a tax on the quantity exchanged and the ____ will be the welfare cost.
a. greater; greater
b. greater; smaller.
c. smaller; greater.
d. smaller; smaller.
a
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If the real interest rate is lower than the equilibrium real interest rate:
A) the quantity of credit demanded equals the quantity of credit supplied. B) the quantity of credit demanded falls short of the quantity of credit supplied. C) the quantity of credit supplied falls short of the quantity of credit demanded. D) interest rates tend to fall further.
Privatization of Social Security involves
A) tax reductions. B) benefit reductions. C) increasing the retirement age. D) investing portions of the trust fund in corporate securities.
Compared to the no-trade situation, when a country imports a good, which of the following will occur?
What will be an ideal response?
Economic stagnation coupled with high inflation is commonly called:
A. stagflation. B. inflationary stagnation. C. stagnatory growth. D. inflagnation.