The supply-side economists expect that a cut in the marginal income tax rate, with lost revenues made up by a cut in government spending, would
a. increase output.
b. decrease output.
c. leave output unchanged.
d. affect output but the direction of the effect is uncertain.
A
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The price of a stock is equal to the present value of expected future dividend payments from the stock
Indicate whether the statement is true or false
In a competitive market equilibrium:
A) social surplus is minimized. B) all the gains from trade are not realized. C) there is Pareto efficiency. D) all the firms earn positive economic profits.
The M2 money supply is represented by
A) M2 = × MB. B) M2 = × . C) MB = × M2. D) MB = × .
Which of the following best illustrates the fallacy of composition?
a. If Jamal had more money, he could afford to buy more goods. b. If Aisha stood up at a basketball game, she could get a better view of the game; if everyone stood up at a basketball game, everyone could have a better view of the game. c. If the price of bread rose, consumers would buy less; if consumers bought less bread, the price of bread would rise. d. High housing prices cause people to buy less housing, but an increase in income might cause them to buy more housing.