Define macroeconomics
What will be an ideal response?
Macroeconomics is the study of the economy as a whole, including topics such as inflation, unemployment, and economic growth.
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Suppose the government considers placing a tax on business profits o that businesses decrease their production and generate a deadweight loss. Revenues from the tax would be used to boost the incomes of the poor
The decision to levy the tax implies that in this case, the government A) values people but not business. B) values efficiency more than its view of fairness. C) profits from taxes. D) values its view of fairness more than efficiency.
When manufacturing a car, parts must be soldered together. This work can be done by labor or by a robot (capital). More robots will be hired when the price of labor increases. This is known as
A) the effect of changing labor productivity. B) marginal revenue product. C) the complementary effect. D) the substitution effect.
Comparing the core inflation rate to the Consumer Price Index, the core inflation rate
A) controls for the biases of the CPI. B) uses current period quantities, not base period quantities. C) measures all goods produced, not just consumer goods. D) includes volatile elements not in the CPI. E) excludes the volatile elements of the CPI.
In the graph below, what happen to price and to total revenue points if the equilibrium moves from point B to point A?
A. Price falls and total revenue increases
B. Price falls and total revenue also decreases
C. Price rises and total revenue also increases
D. Price rises and total revenue decreases