In the long run, if the Fed decreases the growth rate of the money supply,
a. inflation will be lower.
b. unemployment will be higher.
c. real GDP will be lower.
d. All of the above are correct.
a
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Fred enjoys smoking cigars, but his wife Wilma feels ill whenever she is around cigar smoke. Use the Coase theorem to explain how this problem could be solved without government involvement
What will be an ideal response?
Assume milk is used to produce ice cream. Ceteris paribus, a decrease in the price of milk will cause the equilibrium price of ice cream to
A. Increase and the equilibrium quantity of ice cream to increase. B. Decrease and the equilibrium quantity of ice cream to increase. C. Decrease and the equilibrium quantity of ice cream to decrease. D. Increase and the equilibrium quantity of ice cream to decrease.
Assume you pay a tax of $4,000 on a taxable income of $24,000. If your taxable income were $30,000, your tax payment would be $5,000. This suggests that the tax is:
A. progressive. B. proportional. C. regressive. D. discriminatory.
The incentives built into nearly all welfare programs
A. discourage savings. B. encourage marriage. C. encourage family planning. D. encourage work.