In the Keynesian model in the long run, an increase in taxes causes the price level to ________ and the real interest rate to ________.
A. rise; fall
B. rise; rise
C. fall; rise
D. fall; fall
Answer: D
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The reason that the government offers inventors exclusive rights to their product for a period of time is to
A) promote innovation. B) increase profits of certain companies. C) maximize consumer utility. D) reduce market concentration.
When the price of tomatoes is $4, farmers supply 100,000 bushels. When price is $6, farmers supply 100,000 bushels. From this, we conclude that the
a. equilibrium price of tomatoes is $5 b. market-day supply curve is vertical at a quantity of 100,000 c. farmers are producing too many tomatoes d. supply curve for tomatoes is upward sloping e. market demand for tomatoes must be 100,000
Under a fractional-reserve banking system, banks
a. hold more reserves than deposits. b. generally lend out a majority of the funds deposited. c. cause the money supply to fall by lending out reserves. d. All of the above are correct.
The question of how much labor a firm will hire comes down to:
A. whether the value of the marginal product is greater than, less than, or equal to the average total cost. B. whether added workers are going to generate more revenue than what it costs to hire them. C. if the added workers are going to add revenues to the firm. D. the healthcare costs they incur by hiring them.