The Economic Recovery Tax Act of 1981 cut corporate taxes in a way that was designed to
A. encourage firms to use fewer nonrenewable resources.
B. encourage firms to hire more workers.
C. stimulate capital investment.
D. reduce corporate profits.
Answer: C
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GDP counts only final goods and services because this
A) method avoids including any goods that are produced this year and sold next year. B) method avoids double counting of goods going through several stages of production. C) amount can be more easily determined in the marketplace. D) method avoids understating the value of GDP produced during a given year.
Through correspondent banking, large banks provide services to small banks, including
A) loan guarantees. B) foreign exchange transactions. C) issuing stock. D) debt reduction.
A shift in supply is defined as a change in
A. Equilibrium quantity. B. Price. C. Quantity supplied because of a change in price. D. The supply curve because of a change in a determinant of supply.
A firm suffers losses if
A. total revenue is greater than the total variable cost of production but less than total costs. B. price exceeds average variable cost but is less than average total cost. C. price exceeds marginal cost. D. total revenue is greater than the total fixed cost of production.