The following is budget information for a hypothetical economy. All data are in billions of dollars.YearGovernment SpendingTax RevenuesGDP1$1,100$1,000$10,00021,2501,40010,20031,4501,45010,50041,6001,50010,90051,8001,55011,200Refer to the above data. Assume that year 1 is the first year for this economy and year 5 is the current year. What is the public debt in this economy?
A. $250 billion
B. $300 billion
C. $100 billion
D. $150 billion
Answer: B
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The demand curve for the product of a monopolistic competitor
A) is the same as the market demand curve. B) is horizontal. C) is vertical. D) slopes downward.
Which of the following concerning the relationship between elasticity and total revenue is true? a. Price elasticity and total revenue are not related. b. When demand for a good is unit elastic, any price change within the unit elastic price range changes total revenue by one
c. When demand for a good is price inelastic, total revenue increases when price increases. d. When demand for a good is price elastic, total revenue increases when price increases. e. Total revenue is maximized when the price elasticity of demand is zero.
The central difference between the structural stagnation hypothesis and the secular stagnation theory is that:
A. structural stagnation applied in the 1940s, and secular stagnation applies today. B. structural stagnation focuses on globalization, while secular stagnation focuses on declining investment. C. structural stagnation focuses on declining investment, while secular stagnation focuses on globalization. D. structural stagnation is a hypothesis, while secular stagnation is a theory.
Which of the following statements about taxation is TRUE?
A. Dynamic tax analysis assumes that an increase in taxation will leave the tax base unchanged. B. Increasing taxes will always increase tax revenues. C. Static tax analysis recognizes that an increase in taxation could lead to a decrease in tax revenues. D. There is a tax rate at which tax revenues are maximized.