An increase in taxes will have a greater effect on the equilibrium GDP:
A. if the tax revenues are redistributed through transfer payments.
B. the larger the MPS.
C. the smaller the MPC.
D. the larger the MPC.
D. the larger the MPC.
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The above figure shows the market for biologists. The government decides to set a minimum wage for biologists of $18 per hour. After this minimum wage is in effect, the deadweight loss equals ________
A) $400 B) $200 C) $800 D) $1600 E) $100
Which of the following is clearly being sold below cost?
A) 2-for-the-price-of-one theatre tickets B) Senior-citizens discounts on meals at the local diner C) The free software included in the purchase of a new personal computer D) The magazine subscription offering 30% off the regular newsstand price E) None of the above.
When an increase in aggregate demand exceeds the increase in aggregate supply
A) real GDP decreases while nominal GDP increases. B) the price level falls while real GDP increases. C) nominal GDP decreases and real GDP decreases. D) the economy will experience inflation as the price level rises.
The merchandise trade balance
a. reflects trade in intangibles like insurance and tourism b. includes personal gifts to friends abroad c. records the flow of financial assets like stocks and bonds d. equals the value of imports minus the value of exports e. equals the value of tangible products exported minus the value of tangible products imported