Refer to Figure 14.2. The income effect of the wage decrease on the amount of hours of leisure is:
A) L0 to L1.
B) L0 to L2.
C) L1 to L2.
D) L2 to L1.
E) none of the above
E
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A tax levied on the value of physical assets such as land, or financial assets such as corporate stocks and bonds, is known as a(n)
a. corporate income tax b. property tax c. excise tax d. unit tax e. customs duty
When the Phillips curve was first formulated (late 1960s), many economists thought that it showed a
a. "menu" of budget deficits from different budget policies. b. "menu" of possible choices available to policy makers. c. guide to the appropriate mix of fiscal and monetary policy. d. guide of political reactions to economic policy.
When the Fed makes bonds more or less attractive, it influences the:
A. Open market decision. B. Money multiplier. C. Portfolio decision. D. Reserve decision.
You agree to lend ________ to a friend for a year at an annual interest rate of 10%. At the end of the year your friend pays you $600 in interest.
A. $60 B. $660 C. $6,000 D. $6,600