The bias in the CPI affects government outlays because the overstatement of inflation
A) means that tax receipts are less than what is needed to cover government outlays.
B) decreases government outlays by more than what is justified.
C) increases government outlays by more than what is justified.
D) decreases social welfare benefits.
E) increases fiscal pressure.
C
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One example of a microeconomic question is, "How will prices in the clothing industry change if the government bans imports from China?"
Indicate whether the statement is true or false
The higher the concentration ratio, the
a. more control an individual firm has to set prices. b. more competitive the industry. c. less competitive the industry. d. Both a and c are correct.
Mandy purchases 68.2 shares of a mutual fund for $1,500 . Cassie's purchase of these shares contributes $1,500 to which magnitude in the identity Y = C + I + G?
a. C b. I c. G d. None of the above are correct.
Choose the letter of the diagram in Figure 3.1 that best describes the type of shift that would occur in each situation for the market listed on the left, ceteris paribus. Figure 3.1 Shifts of Supply and Demand for Flat-screen TVs: the technology required for flat-screen TV production becomes cheaper.
A. A. B. B. C. C. D. D.