In the simple Keynesian model (no money market) assume that equilibrium output falls short of potential output by 300 units and the MPC = 0.8 . The size of the tax cut needed to reach full employment is
a. 30.
b. 60.
c. 75.
d. 300.
C
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Suppose that an anti-smoking campaign in Moscow, Russia, is successful so that Muscovites smoke less and chew gum more. Tobacco companies lay off workers, while chewing gum manufacturers employ more workers. This is an example of
a. structural unemployment created by efficiency wages. b. structural unemployment created by sectoral shifts. c. frictional unemployment created by efficiency wages. d. frictional unemployment created by sectoral shifts.
Supply-side economists:
A. saw influence beyond in both the Bush and Clinton administrations. B. disagreed with economist Arthur Laffer's views on taxes. C. were influential in President Reagan's decision to change the tax structure. D. believe that government regulations do not reduce productivity and undermine industrial efficiency.
Under what market structure do we have only one firm?
A. Monopoly B. Perfect Competition C. Monopolistic Competition D. Oligopoly
Refer to the information provided in Figure 6.3 below to answer the question(s) that follow.
Figure 6.3Refer to Figure 6.3. Molly's budget constraint is AC. Molly can purchase
A. all of the points along AB. B. all of the points along BD. C. none of the points along AD. D. none of the points along AC.