"A government surplus can decrease investment through the crowding-out effect because the surplus decreases the supply of loanable funds." Is the previous assertion right or wrong? Why?
What will be an ideal response?
The assertion is wrong on two counts. First, the crowding-out effect asserts that a government budget deficit—not a surplus—decreases investment. Second, a government surplus increases—not decreases—the supply of loanable funds.
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People who benefit from a rent ceiling include
A) all landlords. B) taxpayers. C) tenants who have a rent-controlled apartment. D) potential tenants, that is, people looking for apartments. E) all landlords and some tenants.
Explain why gasoline stations across the street from each other with large signs displaying their prices may "legally" jointly set monopoly prices
What will be an ideal response?
A "flat tax" is another term for __________ tax
A) a progressive B) a proportional C) a regressive D) the inflation
Costs that do NOT vary with output are
A) total costs. B) variable costs. C) fixed costs. D) marginal costs.