If a government tax has as its purpose the raising of revenue, it would be best to place the tax on a product which:
A. is a non-essential.
B. has a highly elastic demand.
C. has many good substitutes.
D. has a highly inelastic demand.
Answer: D
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The present value of a fixed-payment loan is calculated as the ________ of the present value of all cash flow payments
A) sum B) difference C) multiple D) log
Society definitely benefits by reducing the number of monopolistically competitive firms.
Answer the following statement true (T) or false (F)
Volkswagen increases the price of a car produced exclusively for export to North America. Which German price index is affected?
A. the CPI B. the GDP deflator C. both the CPI and the GDP deflator D. neither the CPI nor the GDP deflator
If the government undertakes expansionary fiscal policy, it:
A. should force people to change their spending patterns. B. expects aggregate demand to decrease. C. expects aggregate demand to increase. D. could increase income taxes.