Comovement is
A) the tendency for declines in economic activity to be followed by further declines, and for growth in economic activity to be followed by more growth.
B) the idea that the standard pattern of contraction—trough—expansion—peak occurs again and again in industrial economies.
C) the tendency of many economic variables to move together in a predictable way over the business cycle.
D) the idea that peaks and troughs of the business cycle occur at regular intervals.
C
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If a firm decreases its plant size and finds that its long-run average costs have decreased, then
A) the firm should reduce its plant size even more. B) its labor is more productive in a smaller plant. C) its diseconomies of scale are less. D) the firm is now profitable.
When the government makes the people creating an externality, pay for it, the externality is said to be internalized
a. True b. False Indicate whether the statement is true or false
Tax loopholes are equally available to all taxpayers.
Answer the following statement true (T) or false (F)
When we add a personal income tax to the macroeconomic model, the
A. multiplier becomes larger. B. multiplier becomes smaller. C. expenditures schedule shifts upward. D. expenditures schedule becomes steeper.